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PROPERTY

EDITORIAL ADVISORS
Rachel E. Barkow
Segal Family Professor of Regulatory Law and Policy
Faculty Director, Center on the Administration of Criminal Law
New York University School of Law
Erwin Chemerinsky
Dean and Professor of Law
University of California, Berkeley School of Law
Richard A. Epstein
Laurence A. Tisch Professor of Law
New York University School of Law
Peter and Kirsten Bedford Senior Fellow
The Hoover Institution
Senior Lecturer in Law
The University of Chicago
Ronald J. Gilson
Charles J. Meyers Professor of Law and Business
Stanford University
Marc and Eva Stern Professor of Law and Business
Columbia Law School
James E. Krier
Earl Warren DeLano Professor of Law
The University of Michigan Law School
Tracey L. Meares
Walton Hale Hamilton Professor of Law
Director, The Justice Collaboratory
Yale Law School
Richard K. Neumann, Jr.
Professor of Law
Maurice A. Deane School of Law at Hofstra University
Robert H. Sitkoff
John L. Gray Professor of Law
Harvard Law School
David Alan Sklansky
Stanley Morrison Professor of Law
Faculty Co-Director, Stanford Criminal Justice Center
Stanford Law School
Aspen Casebook Series

PROPERTY
Ninth Edition

Jesse Dukeminier
Late Maxwell Professor of Law
University of California
Los Angeles

James E. Krier
Earl Warren DeLano Professor of Law
University of Michigan

Gregory S. Alexander
A. Robert Noll Professor of Law
Cornell University

Michael H. Schill
President and Professor of Law
University of Oregon

Lior Jacob Strahilevitz


Sidley Austin Professor of Law
University of Chicago
Copyright © 2018 James E. Krier as Trustee of the James E. Krier Living Trust, Gregory S. and Kim
K. Alexander, as co-trustees of the Alexander Family Living Trust, Michael H. Schill, and Lior Jacob
Strahilevitz.

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Library of Congress Cataloging-in-Publication Data

Names: Dukeminier, Jesse, author. | Krier, James E., author. | Alexander,


  Gregory S., 1948- author. | Schill, Michael H., author. | Strahilevitz,
  Lior Jacob, author.
Title: Property / Jesse Dukeminier, Late Maxwell Professor of Law, University
  of California, Los Angeles; James E. Krier, Earl Warren DeLano Professor 
  of Law, University of Michigan; Gregory S. Alexander, A. Robert Noll
  Professor of Law, Cornell University; Michael H. Schill, Dean and Harry N.
  Wyatt Professor of Law, University of Chicago; Lior Jacob Strahilevitz,
  Sidley Austin Professor of Law, University of Chicago.
Description: Ninth edition. | New York : Wolters Kluwer Legal & Regulatory
  U.S., [2017] | Series: Aspen casebook series
Identifiers: LCCN 2017048970 | ISBN 9781454881995
Subjects: LCSH: Property — United States. | LCGFT: Casebooks.
Classification: LCC KF560 .D8 2017 | DDC 346.7304 — dc23
LC record available at https://lccn.loc.gov/2017048970
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Summary of Contents
Contents xi
List of Illustrations xxv
Preface to the Ninth Edition xxix
From the Preface to the First Edition xxxi
Acknowledgments xxxiii

Part I.  An Introduction to Some Fundamentals 1


Chapter 1. Acquisition of Property by First Possession:
Discovery and Capture 3
Chapter 2. Acquisition of Property by Subsequent Possession:
Find, Adverse Possession, and Gift 53
Chapter 3. The Limits and Possibilities of Real Property,
Personal Property, and Intellectual Property 131

Part II.  The System of Estates 247


Chapter 4. Possessory Estates 249
Chapter 5. Future Interests 313
Chapter 6. Co-ownership and Marital Interests 387
Chapter 7. Leaseholds: The Law of Landlord and Tenant 461

Part III.  Transfers of Land 551


Chapter 8. The Land Transaction 553
Chapter 9. Title Assurance 661

Part IV.  Land Use Controls 729


Chapter 10. Judicial Land Use Controls: The Law of
Nuisance 731
Chapter 11. Private Land Use Controls: The Law of
Servitudes 761
Chapter 12. Legislative Land Use Controls: The Law of
Zoning 895
Chapter 13. Eminent Domain and the Problem of Regulatory
Takings 997

Appendix A 1149
Appendix B 1151
Table of Cases 1153
Author Index 1169
Subject Index 1177

ix
Contents

List of Illustrations xxv


Preface to the Ninth Edition xxix
From the Preface to the First Edition xxxi
Acknowledgments xxxiii

Part I.  An Introduction to Some Fundamentals 1

Chapter 1. Acquisition of Property by First Possession: Discovery


and Capture 3

A. Acquisition by Discovery 3
Johnson v. M’Intosh 4
Notes and Questions 10
B. Acquisition by Capture 19
Pierson v. Post 19
Notes and Questions 23
Ghen v. Rich 27
Notes and Questions 29
Keeble v. Hickeringill 35
Notes and Questions 37
Note, Problems, and More on the Rule of Capture and
Wild Animals 39
Notes, Questions, and Problems: The Rule of Capture and
Other “Fugitive” Resources 43
Popov v. Hayashi 46
Notes and Questions 52

Chapter 2. Acquisition of Property by Subsequent Possession:


Find, Adverse Possession, and Gift 53

A. Acquisition by Find 53
Armory v. Delamirie 54
Notes and Questions 54
Hannah v. Peel 57
Notes and Questions 62
McAvoy v. Medina 63
Notes and Questions 64

xi
xii Contents

B. Acquisition by Adverse Possession 70


1. The Theory and Elements of Adverse Possession 70
Powell on Real Property § 91.01 70
Henry W. Ballantine, Title by Adverse Possession 71
Oliver Wendell Holmes, The Path of the Law 72
Notes and Questions 72
Van Valkenburgh v. Lutz 76
Notes and Questions 85
Note: Color of Title and Constructive Adverse Possession 88
Problems 88
Mannillo v. Gorski 89
Notes, Questions, and Problems 93
2. The Mechanics of Adverse Possession 95
Howard v. Kunto 95
Questions 100
Problems: Tacking 101
Problems: Disabilities 102
Note: Adverse Possession Against the Government 102
3. Adverse Possession of Chattels 103
O’Keeffe v. Snyder 103
A Note on Georgia O’Keeffe 111
Notes and Questions 112
C. Acquisition by Gift 114
Problems 115
Newman v. Bost 116
Notes and Problems 122
Gruen v. Gruen 123
Notes and Questions 129

Chapter 3. The Limits and Possibilities of Real Property, Personal


Property, and Intellectual Property 131

A. Acquisition by Creation 132


1. Property in One’s Expressions and Ideas: General Principles
of Copyright and Patent Law 133
International News Service v. Associated Press 133
Notes and Questions 137
a. Copyright 140
Feist Publications, Inc. v. Rural Telephone Service Co. 141
Notes and Questions 145
Authors Guild v. Google, Inc. 148
Notes and Questions 159
b. Patent 161
Diamond v. Chakrabarty 162
Notes and Questions 166
2. Property in One’s Person 167
Contents xiii

Moore v. Regents of the University of California 167


Notes and Questions 176
B. The Public Domain 178
1. The Public Trust Doctrine 179
Matthews v. Bay Head Improvement Association 179
Notes and Questions 185
2. Copyright’s Public Domain 187
Eldred v. Ashcroft 187
Notes and Questions 198
3.  Trademark Law’s Public Domain 198
In re Cordua Restaurants, Inc. 200
Notes and Questions 204
C. What Ownership Entails: The Rights to Exclude, Alienate, Abandon,
and Destroy 205
1. The Right to Exclude and Its Limits 205
Notes and Questions 209
2. The Right to Transfer, and Restraints on Alienation 213
Davis v. Davis 213
Notes and Questions 215
Impression Products, Inc. v. Lexmark International, Inc. 216
Notes and Questions 221
3. The Right to Abandon 223
Hawkins v. Mahoney 223
Notes and Questions 226
Pocono Springs Civic Association, Inc. v. MacKenzie 227
Notes and Questions 229
4. The Right to Destroy 232
Eyerman v. Mercantile Trust Co. 232
Notes and Questions 237
In re Estate of Kievernagel 238
Notes and Questions 244

Part II.  The System of Estates 247

Benjamin N. Cardozo, The Nature of the Judicial Process 248

Chapter 4. Possessory Estates 249

A. The Modern Relevance of Estates. 249


B. The Historical Origins of the Estate System 249
1. Tenure 250
2. Feudal Tenures and Services 251
3. Feudal Incidents 252
4. Avoidance of Feudal Incidents 253
5. The Decline of Feudalism 254
Note 255
C. The Fee Simple 255
xiv Contents

1. How the Fee Simple Developed 256


a. Rise of Heritability 256
b. Rise of Alienability 257
c. Rise of the Fee Simple Estate 257
2. Creation of a Fee Simple 257
Problems 258
3. Inheritance of a Fee Simple 258
Notes and Problems 260
D. The Fee Tail 261
E. The Life Estate 265
White v. Brown 266
Note: Restraints on Alienation 271
Note: Valuation of Life Estate and Remainder 273
Baker v. Weedon 274
Notes and Questions 278
Note: Seisin 282
F. Leasehold Estates 282
G. Defeasible Estates 283
Mahrenholz v. County Board of School Trustees 286
Notes, Questions, and Problem 292
Tad Walch, Maeser School Crisis Over 294
Mountain Brow Lodge No. 82, Independent Order of
Odd Fellows v. Toscano 296
Notes and Question 301
Note: Condemnation of Defeasible Fees and the
Valuation of Defeasible Fees and Reversionary Interests 302
Ink v. City of Canton 303
Notes and Questions 307
Note: Defeasible Life Estates and Personal Conduct
Restraints 309
Problem 310
Review Problems 310

Chapter 5. Future Interests 313

A. Introduction 313
B. Future Interests in the Transferor 315
1. Reversion 315
Problems 316
2. Possibility of Reverter 316
3. Right of Entry 317
C. Future Interests in Transferees 317
1. Introduction 318
Problem 318
2. Remainders 319
Contents xv

Problems 321
Question 322
Folsom v. Rowell 322
Notes and Questions 326
3. Executory Interests 327
a. Two Prohibitory Rules: No Shifting Interests;
No Springing Interests 328
b. The Rise of the Use 329
c. Abolition of the Use: The Statute of Uses 330
d. Modern Executory Interests 332
Problems and Note 334
Review Problems 334
D. The Trust 337
Broadway National Bank v. Adams 339
John C. Gray, Restraints on the Alienation of Property 342
Notes and Questions 344
E. Rules Furthering Marketability by Destroying Contingent Future Interests 345
1. Destructibility of Contingent Remainders 346
2. The Rule in Shelley’s Case 347
3. The Doctrine of Worthier Title 348
4. The Rule Against Perpetuities 349
a. The Common Law Rule 349
Jee v. Audley 352
Notes and Questions 354
Problems and Note 357
The Symphony Space, Inc. v. Pergola Properties, Inc. 360
Notes and Questions 370
b. The Perpetuity Reform Movement 373
Jesse Dukeminier & James E. Krier The Rise of the Perpetual Trust 379
Notes 383

Chapter 6. Co-ownership and Marital Interests 387

A. Common Law Concurrent Interests 387


1. Types, Characteristics, Creation 387
Problems and Note 390
2. Severance of Joint Tenancies 392
Riddle v. Harmon 392
Notes and Questions 397
Harms v. Sprague 398
Notes, Questions, and Problems 401
3. Multiple-party Bank Accounts 403
Problems 404
4. Relations Among Concurrent Owners 405
a. Partition 405
Delfino v. Vealencis 406
xvi Contents

Notes, Questions, and Problems 411


b. Sharing the Benefits and Burdens of Co-ownership 416
Spiller v. Mackereth 416
Notes and Questions 418
Swartzbaugh v. Sampson 419
Notes and Questions 423
Notes: Accounting for Benefits, Recovering Costs 425
B. Marital Interests 427
1. The Common Law Marital Property System 428
a. During Marriage (The Fiction That Husband and Wife Are One) 428
Problem 429
Sawada v. Endo 429
Notes and Problems 434
b. Termination of Marriage by Divorce 437
In re Marriage of Graham 438
Notes 443
c. Termination of Marriage by Death of One Spouse 444
Problems 446
Problem 447
2. The Community Property System 447
a. Introduction 447
b. Community Property Compared with Common
Law Concurrent Interests 449
Problem 450
c. Management of Community Property 450
Problem 451
d. Mixing Community Property with Separate Property 452
Problems 452
e. Migrating Couples 453
Problem 454
3. Rights of Domestic Partners 454
Obergefell v. Hodges 456
Notes and Questions 458

Chapter 7. Leaseholds: The Law of Landlord and Tenant 461

A. The Leasehold Estates 461


1. The Term of Years 461
2. The Periodic Tenancy 462
Problems 462
3. The Tenancy at Will 463
Garner v. Gerrish 463
Question and Problems 465
4. The Tenancy at Sufferance: Holdovers 467
B. The Lease 468
C. Selection of Tenants (Herein of Unlawful Discrimination) 471
Contents xvii

Notes, Questions, and Problems 473


D. Delivery of Possession 478
Hannan v. Dusch 479
Notes and Questions 481
Problems 482
E. Subleases and Assignments 483
Ernst v. Conditt 483
Notes and Problems 488
Kendall v. Ernest Pestana, Inc. 490
Notes and Questions 496
Problems 498
F. The Tenant Who Defaults 500
1. The Tenant in Possession 500
Berg v. Wiley 500
Notes and Questions 505
Notes: Summary Proceedings — Purpose and Problems 508
Note: Landlord’s Remedies in Addition to Eviction 510
2. The Tenant Who Has Abandoned Possession 510
Sommer v. Kridel 510
Notes and Questions 516
Notes: Landlord’s Remedies and Security Devices 519
G. Duties, Rights, and Remedies (Especially Regarding
the Condition of the Leased Premises) 522
1. Landlord’s Duties; Tenant’s Rights and Remedies 522
a. Quiet Enjoyment and Constructive Eviction 523
Village Commons, LLC v. Marion County Prosecutor’s Office 523
Notes and Questions 528
Problems 531
Note: The Illegal Lease 532
b. The Implied Warranty of Habitability 533
Hilder v. St. Peter 533
Notes, Questions, and Problems 539
Note: Retaliatory Eviction 542
Notes: Law Reform and the Problem of Decent
Affordable Housing 543
Note and Problems: Landlord’s Tort Liability 546
2. Tenant’s Duties; Landlord’s Rights and Remedies 548

Part III.  Transfers of Land 551

Chapter 8. The Land Transaction 553

A. Introduction to Buying and Selling Real Estate 553


Questions and Problem 567
xviii Contents

B. The Contract of Sale 569


1. The Statute of Frauds 569
Hickey v. Green 571
Notes, Questions, and Problem 574
Note: The Statute of Frauds and Electronic Transactions 575
2. Marketable Title 576
Lohmeyer v. Bower 576
Notes and Questions 579
Note: Equitable Conversion 580
3. The Duty to Disclose Defects 581
Stambovsky v. Ackley 581
Johnson v. Davis 586
Notes and Questions 588
Note: Merger 591
C. The Deed 595
1. Warranties of Title 595
Notes and Questions: The Deed 597
Frimberger v. Anzellotti 600
Notes, Question, and Problems 604
Rockafellor v. Gray 605
Notes and Problems 609
Note: Estoppel by Deed 611
2. Delivery 611
Rosengrant v. Rosengrant 612
Notes and Questions 616
D. Financing Real Estate Transactions 617
1. Introduction to Mortgages and the Mortgage Market 617
Notes, Questions, and Problems 622
2. Mortgage Foreclosure 623
Murphy v. Fin. Dev. Corp. 623
Grant S. Nelson & Dale A. Whitman, Real Estate Finance
Law §7.21 at 640-641 628
Notes and Questions 628
3. The Mortgage Crisis and the Great Recession 631
Commonwealth v. Fremont Investment & Loan 633
Notes and Questions 639
U.S. Bank Natl. Assn. v. Ibanez 640
Notes and Questions 651
4. Mortgage Substitutes: The Installment Land Contract 656
Sebastian v. Floyd 657
Notes 658
Contents xix

Chapter 9. Title Assurance 661

A. The Recording System 661


1. Introduction 661
2. The Indexes 663
Luthi v. Evans 667
Notes and Questions 673
Note: Description by Government Survey 674
Orr v. Byers 678
Notes and Questions 681
3. Types of Recording Acts 682
Problems and Note 685
Messersmith v. Smith 686
Notes and Questions 691
4. Chain of Title Problems 692
Board of Education of Minneapolis v. Hughes 692
Questions and Problems 694
5. Persons Protected by the Recording System 697
Lewis v. Superior Court 698
Notes 701
6. Inquiry Notice 702
Harper v. Paradise 702
Notes, Problem, and Questions 705
7. Marketable Title Acts 707
Walter E. Barnett, Marketable Title Acts — Panacea or
Pandemonium? 708
Problem and Notes 709
8. Recording Systems and the Mortgage Meltdown 710
B. Registration of Title 712
Thomas J. Miceli & C.F. Sirmans, Torrens vs. Title Insurance:
An Economic Analysis of Land Title Systems 714

C. Title Insurance 719


Walker Rogge, Inc. v. Chelsea Title & Guaranty Co. 720
Notes and Questions 725

Part IV.  Land Use Controls 729

Chapter 10. Judicial Land Use Controls:


The Law of Nuisance 731

A. An Introduction to the Substantive Law 731


Morgan v. High Penn Oil Co. 731
Notes and Questions 734
xx Contents

Note: Lateral and Subjacent Support 738


B. Remedies (and More on the Substantive Law) 739
Estancias Dallas Corp. v. Schultz 739
Notes and Questions 741
Boomer v. Atlantic Cement Co. 742
Notes and Questions 746
Spur Industries, Inc. v. Del E. Webb Development Co. 749
Notes and Questions 754
Note: Nuisance Law and Environmental Controls 758

Chapter 11. Private Land Use Controls:


The Law of Servitudes 761

A. Introduction: Classifying Servitudes 761


B. Easements 763
1. Historical Background, and Some Terminology 763
2. Creation of Easements 766
Willard v. First Church of Christ, Scientist 766
Notes and Questions 770
Note: Licenses 772
Holbrook v. Taylor 772
Notes and Questions 776
Van Sandt v. Royster 777
Notes and Questions 783
Othen v. Rosier 785
Notes, Questions, and Problem: Easements by Necessity 793
Notes, Questions, and Problem: Easements by Prescription 795
3. Assignability of Easements 799
Miller v. Lutheran Conference & Camp Association 799
Notes, Questions, and Problem 806
4. Scope of Easements 807
Brown v. Voss 807
Notes, Questions, and Problems 815
5. Termination of Easements 818
Marvin M. Brandt Revocable Trust v. United States 818
Notes, Questions, and Problem 827
6. Negative Easements 829
7. Conservation and Other Novel Easements 832
C. Covenants Running with the Land 835
1. The Traditional Approach 835
a. Covenants Enforceable at Law: Real Covenants 835
Problems 838
b. Covenants Enforceable in Equity: Equitable Servitudes 838
Tulk v. Moxhay 838
Notes and Questions 841
Contents xxi

Neponsit Property Owners’ Association, Inc. v. Emigrant


Industrial Savings Bank 843
Notes and Questions 850
2. The Restatement (Third) Approach 852
3. Creation of Covenants 853
Sanborn v. McLean 854
Notes and Questions 857
4. Discriminatory Covenants 859
Shelley v. Kraemer 859
Notes and Questions 863
5. Termination of Covenants 865
Western Land Co. v. Truskolaski 865
Notes and Questions 870
6. Common Interest Communities 873
Nahrstedt v. Lakeside Village Condominium Association, Inc. 876
California Civil Code §1360.5 (West 2012, enacted 2000) 886
Notes and Questions 886
Problems 888
Timothy Egan, The Serene Fortress: Many Seek Security
in Private Communities 892

Chapter 12. Legislative Land Use Controls:


The Law of Zoning 895

A. Introduction 895
1. Historical Background 895
Village of Euclid v. Ambler Realty Co. 899
Notes and Questions 907
2. The Structure of Authority Underlying Zoning 910
a. Enabling Legislation 910
b. The Comprehensive Plan 911
3. The Economics of Zoning 913
B. The Nonconforming Use 915
PA Northwestern Distributors, Inc. v.
Zoning Hearing Board 915
Problems, Notes, and Questions 919
C. Achieving Flexibility in Zoning 923
1. Variances and Special Exceptions 924
a. Variances 924
Notes and Questions 925
b. Special Exceptions 928
Notes and Questions 930
2. Zoning Amendments and the Spot Zoning Problem 931
Notes and Questions 932
Note: Other Means for Achieving Flexibility in Zoning 935
D. Expanding the Aims (and Exercising the Muscle) of Zoning 937
xxii Contents

1. Aesthetic Regulation 938


State ex rel. Stoyanoff v. Berkeley 938
Notes 944
Anderson v. City of Issaquah 947
Notes and Questions 954
Note: Protection of Religious Establishements and Uses 960
2. Controls on Household Composition 962
Village of Belle Terre v. Boraas 962
Notes 968
3. Exclusionary Zoning 972
Southern Burlington County NAACP
v. Township of Mount Laurel 972
Notes and Questions 986

Chapter 13. Eminent Domain and the Problem


of Implicit Takings 997

A. The Power of Eminent Domain: Sources and Rationales 997


Notes and Questions 999
B. The Public-Use Puzzle (and a Note on Just Compensation) 1001
Kelo v. City of New London 1001
Notes and Questions 1013
Notes: “Just Compensation” 1017
C. Implicit Takings 1021
1. Two Categorical Rules 1022
Loretto v. Teleprompter Manhattan CATV Corp. 1022
Notes and Questions 1033
Hadacheck v. Sebastian 1035
Notes and Questions 1039
2. Rules Based on Measuring and Balancing 1042
Pennsylvania Coal Co. v. Mahon 1042
Notes and Questions 1048
Penn Central Transportation Company v. City of New York 1050
Notes and Questions 1063
Notes: Matters of Remedy 1065
3. Another Categorical Rule 1068
Lucas v. South Carolina Coastal Council 1068
Notes and Questions 1084
Murr v. Wisconsin 1088
Notes and Questions 1101
4. Takings of Personal Property 1102
Horne v. Department of Agriculture 1103
Notes and Questions 1114
Contents xxiii

5. Judicial Takings 1115


Stop the Beach Renourishment, Inc. v. Florida Department of
Environmental Protection 1115
Notes and Questions 1128
6. Special Rules for Exactions 1131
Koontz v. St. Johns River Water Management District 1132
Notes and Questions 1147

Appendix A 1149
Appendix B 1151
Table of Cases 1153
Author Index 1169
Subject Index 1177
List of Illustrations
Chapter 1

Chief Justice John Marshall (painting by Chester Harding) 13


Sir William Blackstone (painting by Sir Joshua Reynolds) 26
Duck Decoy (drawing) 40
Edmund Hickeringhill (painting) 41
Patrick Hayashi and Alex Popov (photograph) 49

Chapter 2

Gwernhaylod House, Overton-on-Dee, Shropshire (photograph) 58


Cartoon by Michael Maslin (wallet) 65
Cartoon by Robert Day (treasure trove) 67
Figure 2-1 (Yonkers, New York, tax map, 1984) 77
Figure 2-2 (map of land in Howard v. Kunto) 96
Georgia O’Keeffe, Seaweed (painting) 106
Georgia O’Keeffe (photograph) 112
J.F. Van Pelt (photograph) 118
Residence of J.F. Van Pelt, Statesville, North Carolina (etching) 121
Gustav Klimt, Schloss Kammer am Attersee II (painting) 126

Chapter 3

AP newsroom circa 1920 (photograph) 138


Bay Head’s sea wall, constructed in 1882 (photograph) 180
Sonny and Cher (photograph) 197

Chapter 4

Time line 4-1 256


Time line 4-2 262
Time line 4-3 265
Jessie Lide’s House, Knoxville, Tennessee (photograph) 268
Time line 4-4 284
Time line 4-5 285
Time line 4-6 286
Odd Fellows Building, Los Banos, California (photograph) 298
Tract of land given by the Toscanos (photograph) 299

xxv
xxvi List of Illustrations

Chapter 5

Time line 5-1 315


Time line 5-2 316
Time line 5-3 317
Time line 5-4 317
Time line 5-5 319
Time line 5-6 320
Henry VIII (painting by Hans Holbein the Younger) 331
Time line 5-7 332
Time line 5-8 332
Time line 5-9 333
Time line 5-10 333
Portrait of John Chipman Gray (photograph) 343
Lloyd, First Baron Kenyon (painting) 353
Symphony Space (advertising poster) 369
Wells Fargo advertisement for So. Dakota Dynasty Trusts 378

Chapter 6

Helen Vealencis (photograph) 407


Figure 6-1 (map of land in Delfino v. Vealencis) 411
Cartoon by Weber (marital arrangement) 427

Chapter 7

The Pierre Apartments, Hackensack, New Jersey (photograph) 511


River View Towers, Fort Lee, New Jersey (photograph) 512
House in Hilder v. St. Peter (photograph) 535

Chapter 8

House, Berkley Hills Addition, Emporia, Kansas (photograph) 577


Haunted House, Nyack, New York (photograph) 584

Chapter 9

Grantor Index (page), Register of Deeds, Suffolk County, Massachusetts 665


Grantor Index (page), Register of Deeds, Coffey County, Kansas 671
Figure 9-1 (Range and Township Lines) 676
Figure 9-2 (Sections in Township 23S, Range 14E) 677
Figure 9-3 (Enlargement of Section 14, Township 23S, Range 14E) 677
Caroline Messersmith’s house (photograph) 687

Chapter 10

Spur Industries, Inc. v. Del. E. Webb Development Co. (Exhibit A) 750


Spur Industries, Inc. v. Del. E. Webb Development Co. (Exhibit B) 751
List of Illustrations xxvii

Chapter 11

Figure 11-1 (Willard v. First Church of Christ, Scientist) 768


Figure 11-2 (Willard v. First Church of Christ, Scientist) 769
Figure 11-3 (Van Sandt v. Royster) 778
Three lots (photographs) 779
Deed (Othen v. Rosier) 786
Figure 11-4 (Othen v. Rosier) 787
Figure 11-5 (easement by necessity) 793
Lake Naomi, Pennsylvania (photograph) 801
Lake Naomi, Pennsylvania (map) 805
Figure 11-6 (Brown v. Voss) 808
Figure 11-7 (privity of estate) 836
Leicester Square today 839
Leicester Square, London, 1852 840
Map of Neponsit, New York 843
Houses in Neponsit (photographs) 845
Green Lawn Subdivision, Lot 86, Detroit, Michigan (photograph) 856
The Shelley House (photograph) 860
Map of Southland Heights Subdivision, Reno, Nevada 866
Cartoon by Starke (holdouts) 872
Lakeside Village Condominiums, Culver City, California (photograph) 878
Natore Nahrstedt with Boo-Boo (photograph) 884
Doonesbury Panel (cartoon) 887
Cartoon by P. Steiner (gated community) 893

Chapter 12

World’s Columbian Exposition, Chicago, 1893 (photograph) 897


Figure 12-1 (Village of Euclid v. Ambler Realty Co.) 903
Houses, Ladue, Missouri (photographs) 941
Stoyanoff house (drawing) 942
Snout house (photograph) 955
Portland house (photograph) 956

Chapter 13

Susette Kelo’s house (photograph) 1003


Cartoon by Trever (eminent domain) 1016
Loretto’s Apartment House, New York City (photograph) 1027
Justice Oliver Wendell Holmes (photograph) 1044
Justice Louis Dembitz Brandeis (photograph) 1046
Breuer I (drawing of tower over Grand Central Terminal) 1053
Breuer II (drawing of tower over Grand Central Terminal) 1053
Figure 13-1 (Development Rights Transfer) 1064
Lucas’s lots (photograph) 1072
Preface to the Ninth Edition

The first edition of this book appeared in 1981. Although periodic revisions have changed
the book considerably over the years, its original aims and methods — set forth in the
Preface to the First Edition reprinted in part on the following page — have held steady.
So has the number of chapters, until now. A new chapter three (“The Limits and
Possibilities of Real Property, Personal Property, and Intellectual Property”) draws on
material formerly appearing in several other chapters, and adds a host of fresh cases
and notes (especially with respect to intellectual property), in order to provide students
with an integrative approach to understanding property law in its various domains.
Emphasizing the connective tissue that runs through real property, personal property,
and intellectual property, the chapter often pairs related cases in ways that help students
draw conceptual connections among doctrines commonly explored in isolation.
As always, our work on the book has benefitted from the contributions of students,
colleagues, friends, and institutions. We are grateful to them for their help.

James E. Krier
Gregory S. Alexander
Michael H. Schill
Lior Jacob Strahilevitz
October 2017

xxix
From the Preface to the First Edition

Property is a thoroughly modern subject of thoroughly antiquated origins. Probably in


no other area of law does one see more, or even as many, strains of the old in the new.
As an institution for allocating resources and distributing wealth and power, property
bears in fundamentally important ways on central issues in contemporary life; as a body
of doctrine, it discharges these modern-day tasks with rules and concepts drawn from
age-old ways of looking at social relations in an ordered society. Property law has, to be
sure, undergone constant change, but — at least in Anglo-American experience — it has
not been revolutionized. Its enduring mix of old and new, rife with uneasy tensions,
reflects more than an institution that has evolved over centuries and across cultures; it
reflects as well two often conflicting objectives — promoting stability and accommodating
change — that property systems must serve. To study property is to study social history,
social relations, and social reform.
It is also, of course, to study law. The primary objective of this coursebook is to help
students learn the complicated structure and functions of property doctrine and some-
thing of legal method, legal reasoning, and legal analysis. We have, however, secondary
objectives as well, suggested by our opening remarks. How, why, and with what implica-
tions does the property system order relations in present-day America? What sorts of
incentives does it create in terms of constructive use of scarce, valuable resources? How
fairly does it confer benefits and impose burdens? To what extent is today’s system a valu-
able, or a useless, legacy of the past? What sorts of reforms are suggested, and what might
they achieve?
To pursue such secondary questions as these, and especially to accomplish the pri-
mary end of learning law and legal method, we need large doses of doctrine, but also a
sense of history and of methods of critiquing institutional performance. There is, then,
lots of law in what follows — in cases, statutes, text, and problems. There is also a consis-
tent effort to trace historical antecedents. Finally, there is a fairly systematic, but by no
means dominating, attempt to critique — often through an economic lens. Economics,
like property, is in large part about resources. The economics in the book can be managed
easily, we think, even by the totally uninitiated; it can also be ignored or even scorned. So
too for the history, if one likes.

Jesse Dukeminier
James E. Krier

February 1, 1981

xxxi
Acknowledgments

The authors acknowledge the permissions kindly granted to reproduce excerpts


from, or illustrations of, the materials indicated below.

Books and Articles

American Law Institute, Restatement (Third) of Property, Servitudes (2000). Copyright


© 2000 by the American Law Institute.
Baird, Douglas G., Common Law Intellectual Property and the Legacy of International
News Service v. Associated Press, 40 U. Chi. L. Rev. 411 (1983). Copyright © 1983 by
University of Chicago Law Review. Reproduced with permission of the University of
Chicago Law School via Copyright Clearance Center.
Barnett, Walter, Marketable Title Acts—Panacea or Pandemonium?, 53 Cornell L. Rev.
45, 52-54. Copyright ©1967 by Cornell Law Review. Reprinted by permission of the
Cornell Law Review via Copyright Clearance Center.
Berger, Lawrence, The Public Use Requirement in Eminent Domain, 57 Or. L. Rev. 203
(1978).
Dukeminier, Jesse, and James E. Krier, The Rise of the Perpetual Trust, 50 UCLA L. Rev.
1303 (2003). Reprinted with permission.
Egan, Timothy, The Serene Fortress: Many Seek Security in Private Communities, N.Y.
Times, Sept. 3, 1995. Copyright © 1995 by The New York Times Company. Reprinted
by permission.
Krier, James E., and Christopher Serkin, Public Ruses, 2004 Mich. St. L. Rev. 859, 862-863.
Reprinted by permission.
Merrill, Thomas W. and Henry E. Smith, Optimal Standardization in the Law of Property:
The Numerus Clausus Principle, 110 Yale L.J. 1, 22-23 (2000). Used by permission.
Miceli, Thomas J., and C.F. Sirmans, Torrens versus Title Insurance: An Economic
Analysis of Land Title Systems, Illinois Real Estates Letter (Fall 1997). Reprinted
with permission.
Michelman, Frank, Property, Utility, and Fairness: Comments on the Ethical Foundations
of ‘‘Just Compensation Law,’’ 80 Harv. L. Rev. 1168 (1967). Copyright © 1967 by the
Harvard Law Review Association.
Multi-Board Residential Real Estate Contract, REALTOR Association of the Western
Suburbs. Used by permission.
Perry, Sandra White, Letter to editors regarding Jessie Lide’s house (1988).
Posner, Richard A., Economic Analysis of Law (9th ed. 2014). Copyright © 2014 CCH,
Inc. Reprinted by permission of Wolters Kluwer.
Powell, Richard R., The Law of Real Property (Michael A. Wolf gen. ed. 2009). Copyright
© 2009 by Matthew Bender & Co., Inc.
Walch, Tad, Maeser School Crisis Over, Deseret Morning News, Sept. 25, 2007. Reprinted
by permission.

xxxiii
xxxiv Acknowledgments

Illustrations

AP Newsroom, circa 1920, photograph. Reproduced with permission of AP/Wide World


Photos.
Apartment building in Greenwich Village, Manhattan, New York City, photograph cour-
tesy of iStock Photo/Robert Crum.
Blackstone, Sir William, portrait by Sir Joshua Reynolds. Copyright © National Portrait
Gallery, London. Reproduced with permission.
Brandeis, Louis Dembitz, photograph, collection of the Supreme Court of the United
States.
Day, Robert J., cartoon. Copyright © Robert J. Day/The New Yorker Collection/The
Cartoon Bank. Reproduced by permission of Condé Nast.
Decoyman driving wild duck up the pipe, Vincent Brooks Day & Son, Lith., drawn by Sir
Ralph Payne-Gallwey. Used with permission of Providence Press.
de Lamerie, Paul, Tureen and Cover (1736-37), photograph courtesy of Virginia Museum
of Fine Arts, Richmond. Gift of Rita R. Gans. Photograph by Katherine Wetzel.
Copyright © Virginia Museum of Fine Arts. Reproduced with permission.
Delfino v. Vealencis, Bristol, Connecticut, map of land, from Manuel Baucells & Steven A.
Lippman, Justice Delayed Is Justice Denied: A Co-operative Game Theoretic Analysis
of Hold Up in Co-Ownership, 22 Cardozo L. Rev. 1191, 1222 (2001).
Development Rights Transfer, from John J. Costonis, Space Adrift (1974). Copyright ©
1974 by the University of Illinois Press.
Doonesbury © 2001 G. B. Trudeau. Reprinted with permission of Universal UClick. All
rights reserved.
Emporia, Kansas, Berkley Hills Addition, house, 1991 photograph by Chad Johnson.
For sale by owner, photograph courtesy of iStock Photo/CHRISsadowski.
Gravesite of Noah Phelps in Revolutionary War cemetery in Austerlitz, New York, photo-
graph courtesy of Getty Images/Fotosearch.
Gray, J.C., portrait, Harvard Law Library. Used by permission.
Gray’s Mansion, Chanute, Kansas, photograph by Vernon R. Parham, M.D.
Green Lawn Subdivision, Detroit, Michigan, photograph by Wendy L. Wilkes.
Gwernhaylod House, Overton-on-Dee, Wales, photograph, 1956. © Crown copyright:
Royal Commission of the Ancient and Historical Monuments of Wales, reproduced
with permission of the National Monuments Record of Wales.
Haunted House, Nyack, New York, photograph, from The Nyack Library Local History
Image Collection. Reproduced with permission of The Nyack Library.
Hayashi, Patrick and Alex Popov, photograph. Robert Rosamilio/NY Daily News Archive
via Getty Images.
Henry VIII, painting by Hans Holbein the Younger.
Hickeringill, Edmund, possibly by R.C. Roffe, after J. Jull. Chronicle/Alamy Stock Photo.
Reproduced with permission.
Holmes, Oliver Wendell, photograph, collection of the Supreme Court of the United
States.
Howard v. Kunto, Washington, map © 1995 by Barry C. Nelson.
Kelo house, New London, Connecticut, photograph. Used with permission of the Institute
for Justice (www.ij.org).
Kenyon, Lloyd, 1st Baron Kenyon, painting by William Davison, after George Romney,
and Sir Martin Archer Shee. Copyright © National Portrait Gallery, London. Used
with permission.
Kings Weston House, photograph courtesy of iStock Photo/Paola V1.
Acknowledgments xxxv

Klimt, Gustav, painting entitled “Schloss Kammer am Attersee II.” Private collection.
Reproduced by permission of Galerie St. Etienne, New York.
Ladue, Missouri, residences, 1999, photographs by Stuart Banner.
Lakeside Village Condominiums, Culver City, California, photograph by Jesse Dukeminier.
Lake Naomi, Pennsylvania, photograph, from Emma Miller Waygood, Changing Times in
the Poconos (1972). Reprinted by permission of Mary Brower.
Lake Naomi, Pennsylvania, map, from the appellant’s brief in Miller v. Lutheran
Conference & Camp Assn., courtesy of Barlow Burke.
Leicester Square, London, etching, from the British Museum, London.
Leicester Square, London, 2012 photograph by Kim K. Alexander.
Lide, Jessie, Knoxville, Tennessee, house, 1956 photograph, courtesy of Sandra White
Perry.
Loretto’s Apartment House, New York City, photograph by Michael S. Gruen.
Lost and Found sign, photograph, courtesy of Shutterstock/asiandelight.
Lucas v. South Carolina Coastal Council, lots, 2000, photograph by David S. Sanders.
Macefield, Edith, house in Seattle, photograph. Copyright © 2008 Stuart Isett. All rights
reserved. Used with permission.
Man with hunting dogs, photograph courtesy of Getty Images/Doug Menuez.
Maslin, Michael, cartoon. © 2009 Michael Maslin/The New Yorker Collection/The
Cartoon Bank. Reproduced by permission of Condé Nast.
Marshall, John, portrait by Chester Harding. Reproduced by permission of the Boston
Athenæum.
Messersmith, Caroline, Dickinson, North Dakota, house, 1999 photograph by Richard
Volesky.
Mortgage records in canvas binders from a government records center, photo-
graph courtesy of iStock Photo/wsmahar.
Nahrstedt, Natore, photograph by Alan J. Duignan from Los Angeles Times, Dec. 24,
1992. Reproduced by permission.
Neponsit, New York houses, 1980, photograph by David S. Sanders.
Odd Fellows Building and tract of land used for parking lot, Los Banos, California, pho-
tographs by Todd Benjamin.
O’Keeffe, Georgia, painting entitled “Seaweed,” 1926. Copyright © 2017 Georgia O’Keeffe
Museum / Artists Rights Society (ARS), New York. Reprinted by permission.
O’Keeffe, Georgia, 1968 photograph by Arnold Newman. Copyright © Arnold Newman/
Getty Images (1968).
Pierre Apartments, Hackensack, New Jersey, photograph by David S. Sanders.
Railroad tracks, photograph courtesy of iStock Photo/mbbirdy.
Real estate agent giving keys to new property owners, photograph courtesy of iStock
Photo/LDProd.
Residences on lots 19, 20, and 4, Chanute, Kansas, photograph by Vernon R. Parham,
M.D.
River View Towers, Fort Lee, New Jersey, photograph by David S. Sanders.
Seawall in Bay Head, N.J., photograph by David Gard, from The Star-Ledger, July 18,
2013. Copyright © 2013 The Star-Ledger. All rights reserved. Used by permission
and protected by the Copyright Laws of the United States. The printing, copying,
redistribution, or retransmission of this Content without express written permission
is prohibited.
Shelley House in St. Louis, Missouri, street level view, photograph by FrancisNancy.
Reproduced via Creative Commons.
Smoke stacks, photograph courtesy of iStock Photo/debstheleo.
xxxvi Acknowledgments

Snout houses, photographs, from N.Y. Times, April 20, 2000. Photographer: Shane Young.
Reproduced by permission of NYT Permissions.
Starke, Leslie, cartoon. Copyright © Leslie Starke/The New Yorker Collection/The
Cartoon Bank. Reproduced by permission of Condé Nast.
Steiner, Peter, cartoon. Copyright © 1996 Peter Steiner/The New Yorker Collection/The
Cartoon Bank. Reproduced by permission of Condé Nast.
Stoyanoff house, Ladue, Missouri, 2001 drawing by Stephen Harby.
Symphony Space, New York City, photograph by Charles Langelia, 2001 advertising poster.
Trever, John, cartoon. © 2005 John Trever and the Albuquerque Journal. Reprinted by
permission.
Van Pelt, J. F., photograph, from The Steve Hill Collection, Mitchell Community College,
North Carolina. Reproduced by permission of Bill Moose.
Van Pelt Residence, Statesville, North Carolina, etching, courtesy of Bill Moose.
Van Sandt v. Royster, Lots 19, 20, and 4, map by Greg R. Vetter and Marcilynn A. Burke.
Vealencis, Helen, photograph from Manel Baucells & Steven A. Lippman, Justice
Delayed Is Justice Denied: A Cooperative Game Theoretic Analysis of Hold-Up in
Co-Ownership, 22 Cardozo L. Rev. 1191, 1249 (2001).
Weber, Robert, cartoon. ©1977 Robert Weber/The New Yorker Collection/The Cartoon
Bank. Reproduced by permission of Condé Nast.
Wells Fargo Legacy Trust advertisement. Reprinted with permission of Wells Fargo Bank
South Dakota, N. A.
World’s Columbian Exposition, Chicago, 1893, photograph, ICHi-02530, View looking
east at the Court of Honor, photographer—C. D. Arnold. Reproduced by permis-
sion of the Chicago History Museum.
A NOTE TO STUDENTS

This book has supplementary online resources at


CasebookConnect.com
Refer to the sticker in the front
of your book for instructions
on accessing the resources at
CasebookConnect.com.

In your Connected Casebook, go


to the “Resources” tab to explore
the additional materials.

Navigation

The website is geared to the book chapter by


chapter, and within each chapter by topic.

Acquisition, Chapters 1 & 2

Co-ownership, Chapter
6 5

We welcome any comments or suggestions you might have about improving the site and
making it more useful and interesting to you.

Please email your feedback to Lior@Chicago.edu xxxvii


PROPERTY
PA RT I

An Introduction to Some
Fundamentals

The first three chapters of this book pursue a common theme — how someone
might acquire property other than by purchase — across a wide range of legal
terrain. One purpose of the exercise is to lay down the chief doctrinal founda-
tions of property law. Another is to introduce some basic concepts, issues, and
analytic methods of ongoing importance. After exploring how a person acquires
property, the section concludes with an examination of what an owner can and
cannot do with it.
Chapter 1

Acquisition of Property by First


Possession: Discovery
and Capture

Qui prior est tempore potior est jure.


(Who is prior in time is stronger in right.) — 
Maxim of Roman Law
First come, first served. — 
Henry Brinklow,
Complaynt of Roderick Mors, Ch. 17 (c. 1545)

How does property come to be, and why, and so what? Most of us most of the time
take these questions for granted, which is to say that we take property for granted.
But taking something for granted is not exactly the best path to understanding it.
So we begin with the origins of property.

A.  Acquisition by Discovery

Thus in the beginning all the world was America. . . . — 


John Locke,
Two Treatises of Government,
Book II, Ch. V (“Of Property”) (c. 1690)

3
4

Johnson v. M’Intosh
Supreme Court of the United States, 1823
21 U.S. (8 Wheat.) 543

Error to the District Court of Illinois. This was an action of ejectment for lands in
the State and District of Illinois, claimed by the plaintiffs under a purchase and
conveyance from the Piankeshaw Indians, and by the defendant, under a [later]
grant from the United States. It came up on a case stated, upon which there was
a judgment below for the defendant. . . .

Chief Justice Marshall delivered the opinion of the Court.


The plaintiffs in this cause claim the land, in their declaration mentioned,
under two grants, purporting to be made, the first in 1773, and the last in 1775,
by the chiefs of certain Indian tribes, constituting the Illinois and the Piankeshaw
nations; and the question is, whether this title can be recognised in the Courts of
the United States?
The facts, as stated in the case agreed, show the authority of the chiefs who
executed this conveyance, so far as it could be given by their own people; and
likewise show, that the particular tribes for whom these chiefs acted were in right-
ful possession of the land they sold. The inquiry, therefore, is, in a great measure,
confined to the power of Indians to give, and of private individuals to receive, a
title which can be sustained in the Courts of this country.
As the right of society, to prescribe those rules by which property may be
acquired and preserved is not, and cannot be drawn into question; as the title to
lands, especially, is and must be admitted to depend entirely on the law of the
nation in which they lie; it will be necessary, in pursuing this inquiry, to examine,
not singly those principles of abstract justice, which the Creator of all things has
impressed on the mind of his creature man, and which are admitted to regulate,
in a great degree, the rights of civilized nations, whose perfect independence is
acknowledged; but those principles also which our own government has adopted
in the particular case, and given us as the rule for our decision.
On the discovery of this immense continent, the great nations of Europe
were eager to appropriate to themselves so much of it as they could respectively
acquire. Its vast extent offered an ample field to the ambition and enterprise of
all; and the character and religion of its inhabitants afforded an apology for con-
sidering them as a people over whom the superior genius of Europe might claim
an ascendency. The potentates of the old world found no difficulty in convincing
themselves that they made ample compensation to the inhabitants of the new, by
bestowing on them civilization and Christianity, in exchange for unlimited inde-
pendence. But, as they were all in pursuit of nearly the same object, it was nec-
essary, in order to avoid conflicting settlements, and consequent war with each
other, to establish a principle, which all should acknowledge as the law by which
the right of acquisition, which they all asserted, should be regulated as between
themselves. This principle was, that discovery gave title to the government by
whose subjects, or by whose authority, it was made, against all other European
governments, which title might be consummated by possession.
5

The exclusion of all other Europeans, necessarily gave to the nation making
the discovery the sole right of acquiring the soil from the natives, and establish-
ing settlements upon it. It was a right with which no Europeans could interfere.
It was a right which all asserted for themselves, and to the assertion of which, by
others, all assented.
Those relations which were to exist between the discoverer and the natives,
were to be regulated by themselves. The rights thus acquired being exclusive, no
other power could interpose between them.
In the establishment of these relations, the rights of the original inhabitants
were, in no instance, entirely disregarded; but were necessarily, to a considerable
extent, impaired. They were admitted to be the rightful occupants of the soil,
with a legal as well as just claim to retain possession of it, and to use it according
to their own discretion, but their rights to complete sovereignty, as independent
nations, were necessarily diminished, and their power to dispose of the soil at
their own will, to whomsoever they pleased, was denied by the original fundamen-
tal principle, that discovery gave exclusive title to those who made it.
While the different nations of Europe respected the right of the natives, as
occupants, they asserted the ultimate dominion to be in themselves; and claimed
and exercised, as a consequence of this ultimate dominion, a power to grant the
soil, while yet in possession of the natives. These grants have been understood by
all, to convey a title to the grantees, subject only to the Indian right of occupancy.
The history of America, from its discovery to the present day, proves, we
think, the universal recognition of these principles.
Spain did not rest her title solely on the grant of the Pope. Her discussions
respecting boundary, with France, with Great Britain, and with the United States,
all show that she placed it on the rights given by discovery. Portugal sustained her
claim to the Brazils by the same title.
France, also, founded her title to the vast territories she claimed in America
on discovery. However conciliatory her conduct to the natives may have been,
she still asserted her right of dominion over a great extent of country not actually
settled by Frenchmen, and her exclusive right to acquire and dispose of the soil
which remained in the occupation of Indians. . . .
The claim of the Dutch was always contested by the English; not because
they questioned the title given by discovery, but because they insisted on being
themselves the rightful claimants under that title. Their pretensions were finally
decided by the sword.
No one of the powers of Europe gave its full assent to this principle, more
unequivocally than England. The documents upon this subject are ample and com-
plete. So early as the year 1496, her monarch granted a commission to the Cabots, to
discover countries then unknown to Christian people, and to take possession of them
in the name of the king of England. Two years afterwards, Cabot proceeded on this
voyage, and discovered the continent of North America, along which he sailed as far
south as Virginia. To this discovery the English trace their title.
In this first effort made by the English government to acquire territory on
this continent, we perceive a complete recognition of the principle which has
been mentioned. The right of discovery given by this commission, is confined
to countries “then unknown to all Christian people”; and of these countries
6

Cabot was empowered to take possession in the name of the king of England.
Thus asserting a right to take possession, notwithstanding the occupancy of the
natives, who were heathens, and, at the same time, admitting the prior title of any
Christian people who may have made a previous discovery.
The same principle continued to be recognised. [Omitted here is a discus-
sion of various charters from the English crown, granting lands in America.]
Thus has our whole country been granted by the crown while in the occupa-
tion of the Indians. These grants purport to convey the soil as well as the right of
dominion to the grantees. In those governments which were denominated royal,
where the right to the soil was not vested in individuals, but remained in the
crown, or was vested in the colonial government, the king claimed and exercised
the right of granting lands, and of dismembering the government at his will.
The grants made out of the two original colonies, after the resumption of their
charters by the crown, are examples of this. The governments of New-England,
New-York, New-Jersey, Pennsylvania, Maryland, and a part of Carolina, were thus
created. In all of them, the soil, at the time the grants were made, was occupied
by the Indians. Yet almost every title within those governments is dependent on
these grants. In some instances, the soil was conveyed by the crown unaccompa-
nied by the powers of government, as in the case of the northern neck of Virginia.
It has never been objected to this, or to any other similar grant, that the title as
well as possession was in the Indians when it was made, and that it passed nothing
on that account.
These various patents cannot be considered as nullities; nor can they be
limited to a mere grant of the powers of government. A charter intended to con-
vey political power only, would never contain words expressly granting the land,
the soil, and the waters. Some of them purport to convey the soil alone; and in
those cases in which the powers of government, as well as the soil, are conveyed
to individuals, the crown has always acknowledged itself to be bound by the grant.
Though the power to dismember regal governments was asserted and exercised,
the power to dismember proprietary governments was not claimed; and, in some
instances, even after the powers of government were revested in the crown, the
title of the proprietors to the soil was respected. . . .
Further proofs of the extent to which this principle has been recognised,
will be found in the history of the wars, negotiations, and treaties, which the dif-
ferent nations, claiming territory in America, have carried on, and held with each
other. . . .
Thus, all the nations of Europe, who have acquired territory on this conti-
nent, have asserted in themselves, and have recognised in others, the exclusive
right of the discoverer to appropriate the lands occupied by the Indians. Have the
American States rejected or adopted this principle?
By the treaty which concluded the war of our revolution, Great Britain relin-
quished all claim, not only to the government, but to the “propriety and territorial
rights of the United States,” whose boundaries were fixed in the second article. By
this treaty, the powers of government, and the right to soil, which had previously
been in Great Britain, passed definitively to these States. We had before taken
possession of them, by declaring independence; but neither the declaration of
independence, nor the treaty confirming it, could give us more than that which
7

we before possessed, or to which Great Britain was before entitled. It has never
been doubted, that either the United States, or the several States, had a clear title
to all the lands within the boundary lines described in the treaty, subject only to
the Indian right of occupancy, and that the exclusive power to extinguish that
right, was vested in that government which might constitutionally exercise it.
Virginia, particularly, within whose chartered limits the land in controversy
lay, passed an act, in the year 1779, declaring her

exclusive right of pre-emption from the Indians, of all the lands within the limits
of her own chartered territory, and that no person or persons whatsoever, have, or
ever had, a right to purchase any lands within the same, from any Indian nation,
except only persons duly authorized to make such purchase; formerly for the use
and benefit of the colony, and lately for the Commonwealth.

The act then proceeds to annul all deeds made by Indians to individuals, for
the private use of the purchasers.
Without ascribing to this act the power of annulling vested rights, or admit-
ting it to countervail the testimony furnished by the marginal note opposite to
the title of the law, forbidding purchases from the Indians, in the revisals of the
Virginia statutes, stating that law to be repealed, it may safely be considered as an
unequivocal affirmance, on the part of Virginia, of the broad principle which had
always been maintained, that the exclusive right to purchase from the Indians
resided in the government.
In pursuance of the same idea, Virginia proceeded, at the same session, to
open her land office, for the sale of that country which now constitutes Kentucky,
a country, every acre of which was then claimed and possessed by Indians, who
maintained their title with as much persevering courage as was ever manifested
by any people.
The States, having within their chartered limits different portions of terri-
tory covered by Indians, ceded that territory, generally, to the United States, on
conditions expressed in their deeds of cession, which demonstrate the opinion,
that they ceded the soil as well as jurisdiction, and that in doing so, they granted
a productive fund to the government of the Union. The lands in controversy lay
within the chartered limits of Virginia, and were ceded with the whole country
northwest of the river Ohio. . . . The ceded territory was occupied by numerous
and warlike tribes of Indians; but the exclusive right of the United States to extin-
guish their title, and to grant the soil, has never, we believe, been doubted. . . .
Our late acquisitions from Spain are of the same character; and the negotia-
tions which preceded those acquisitions, recognise and elucidate the principle
which has been received as the foundation of all European title in America.
The United States, then, have unequivocally acceded to that great and broad
rule by which its civilized inhabitants now hold this country. They hold, and assert
in themselves, the title by which it was acquired. They maintain, as all others have
maintained, that discovery gave an exclusive right to extinguish the Indian title
of occupancy, either by purchase or by conquest; and gave also a right to such
a degree of sovereignty, as the circumstances of the people would allow them to
exercise.
8

Map of land claims in Johnson v. M’Intosh. The areas in horizontal lines are the tracts
purchased by the Illinois Company (1773). The areas in the hashed lines are the tracts
purchased by the Wabash Company (1775). The areas in black are the townships
containing McIntosh purchases of 1815, at issue in the case.
(Courtesy of Professor Eric Kades.)

The power now possessed by the government of the United States to grant
lands, resided, while we were colonies, in the crown, or its grantees. The validity
of the titles given by either has never been questioned in our Courts. It has been
exercised uniformly over territory in possession of the Indians. The existence of
this power must negative the existence of any right which may conflict with, and
control it. An absolute title to lands cannot exist, at the same time, in different
persons, or in different governments. An absolute must be an exclusive title, or at
least a title which excludes all others not compatible with it. All our institutions
recognise the absolute title of the crown, subject only to the Indian right of occu-
pancy, and recognise the absolute title of the crown to extinguish that right. This
is incompatible with an absolute and complete title in the Indians.
We will not enter into the controversy, whether agriculturists, merchants, and
manufacturers, have a right, on abstract principles, to expel hunters from the terri-
tory they possess, or to contract their limits. Conquest gives a title which the Courts
9

of the conqueror cannot deny, whatever the private and speculative opinions of
individuals may be, respecting the original justice of the claim which has been suc-
cessfully asserted. The British government, which was then our government, and
whose rights have passed to the United States, asserted a title to all the lands occu-
pied by Indians, within the chartered limits of the British colonies. It asserted also
a limited sovereignty over them, and the exclusive right of extinguishing the title
which occupancy gave to them. These claims have been maintained and estab-
lished as far west as the river Mississippi, by the sword. The title to a vast portion of
the lands we now hold, originates in them. It is not for the Courts of this country
to question the validity of this title, or to sustain one which is incompatible with it.
Although we do not mean to engage in the defence of those principles which
Europeans have applied to Indian title, they may, we think, find some excuse, if
not justification, in the character and habits of the people whose rights have been
wrested from them.
The title by conquest is acquired and maintained by force. The conqueror
prescribes its limits. Humanity, however, acting on public opinion, has estab-
lished, as a general rule, that the conquered shall not be wantonly oppressed, and
that their condition shall remain as eligible as is compatible with the objects of
the conquest. Most usually, they are incorporated with the victorious nation, and
become subjects or citizens of the government with which they are connected.
The new and old members of the society mingle with each other; the distinction
between them is gradually lost, and they make one people. Where this incorpora-
tion is practicable, humanity demands, and a wise policy requires, that the rights
of the conquered to property should remain unimpaired; that the new subjects
should be governed as equitably as the old, and that confidence in their security
should gradually banish the painful sense of being separated from their ancient
connexions, and united by force to strangers.
When the conquest is complete, and the conquered inhabitants can be blended
with the conquerors, or safely governed as a distinct people, public opinion, which
not even the conqueror can disregard, imposes these restraints upon him; and he
cannot neglect them without injury to his fame, and hazard to his power.
But the tribes of Indians inhabiting this country were fierce savages, whose
occupation was war, and whose subsistence was drawn chiefly from the forest. To
leave them in possession of their country, was to leave the country a wilderness; to
govern them as a distinct people, was impossible, because they were as brave and
as high spirited as they were fierce, and were ready to repel by arms every attempt
on their independence.
What was the inevitable consequence of this state of things? The Europeans
were under the necessity either of abandoning the country, and relinquishing
their pompous claims to it, or of enforcing those claims by the sword, and by
the adoption of principles adapted to the condition of a people with whom it
was impossible to mix, and who could not be governed as a distinct society, or of
remaining in their neighbourhood, and exposing themselves and their families
to the perpetual hazard of being massacred.
Frequent and bloody wars, in which the whites were not always the aggres-
sors, unavoidably ensued. European policy, numbers, and skill prevailed. As the
white population advanced, that of the Indians necessarily receded. The country
10

in the immediate neighbourhood of agriculturists became unfit for them. The


game fled into thicker and more unbroken forests, and the Indians followed.
The soil, to which the crown originally claimed title, being no longer occupied
by its ancient inhabitants, was parcelled out according to the will of the sovereign
power, and taken possession of by persons who claimed immediately from the
crown, or mediately, through its grantees or deputies.
That law which regulates, and ought to regulate in general, the relations
between the conqueror and conquered, was incapable of application to a people
under such circumstances. The resort to some new and different rule, better
adapted to the actual state of things, was unavoidable. Every rule which can be
suggested will be found to be attended with great difficulty.
However extravagant the pretension of converting the discovery of an inhab-
ited country into conquest may appear; if the principle has been asserted in the first
instance, and afterwards sustained; if a country has been acquired and held under
it; if the property of the great mass of the community originates in it, it becomes the
law of the land, and cannot be questioned. So, too, with respect to the concomitant
principle, that the Indian inhabitants are to be considered merely as occupants,
to be protected, indeed, while in peace, in the possession of their lands, but to be
deemed incapable of transferring the absolute title to others. However this restric-
tion may be opposed to natural right, and to the usages of civilized nations, yet, if it
be indispensable to that system under which the country has been settled, and be
adapted to the actual condition of the two people, it may, perhaps, be supported by
reason, and certainly cannot be rejected by Courts of justice. . . .
It has never been contended, that the Indian title amounted to nothing.
Their right of possession has never been questioned. The claim of government
extends to the complete ultimate title, charged with this right of possession, and
to the exclusive power of acquiring that right. . . .
After bestowing on this subject a degree of attention which was more
required by the magnitude of the interest in litigation, and the able and elabo-
rate arguments of the bar, than by its intrinsic difficulty, the Court is decidedly
of opinion, that the plaintiffs do not exhibit a title which can be sustained in the
Courts of the United States; and that there is no error in the judgment which was
rendered against them in the District Court of Illinois.
Judgment affirmed, with costs.

NOTES AND QUESTIONS

1. A logical place to begin.  Our concern here is not the complexities of title to
land once occupied exclusively by Native Americans.1 We are interested, instead,
in getting a study of property under way, and Johnson v. M’Intosh provides an apt
point of departure for several reasons.

1. Students wishing to pursue these and other issues regarding the legal situation of Native Americans
might well begin their inquiries with Felix Cohen’s Handbook of Federal Indian Law (rev. ed. 2012). Cohen
(1907-1953), a man of great heart and energy, made important contributions to a number of fields, including
legal philosophy. He was the son of another leading philosopher, Morris Cohen (1880-1947), whose views on
“Property and Sovereignty” will be considered shortly.
11

First, how better to start a course in the American law of property than with
the foundations of landownership in the United States? Land, you will learn,
plays an important part in property law, and not just because so much of that
law aims to resolve — better yet, avoid — conflicts over real property (as land is
called). Landownership also commonly determines the ownership and control of
a host of other natural resources, such as wild animals, water and minerals, peace
and quiet, clean air, and open space. Moreover, many of the general legal prin-
ciples pertaining to real property also apply to personal property and intellectual
property (that is, property other than land). So landownership is important, and,
as Johnson v. M’Intosh suggests, most landowners in the United States trace their
ownership — their title — back to grants (or patents, as they are called in the case
of conveyances of public land out of the government) from the United States.
The United States, in turn, traces its title, by grant and otherwise, all the way back
to the “discovery” of America by white men.2
2. Discovery .  .  . or conquest?  Discovery and conquest, both of which are
mentioned in Chief Justice Marshall’s3 opinion in the Johnson case, are terms of
art referring to methods of acquiring territory in international law. Acquisition
by discovery entails “the sighting or ‘finding’ of hitherto unknown or uncharted
territory; it is frequently accompanied by a landing and the symbolic taking of
possession,” acts that give rise to an inchoate title that must (on one view) sub-
sequently be perfected, within a reasonable time, by settling in and making an
effective occupation. 4 Encyclopedia of Public International Law 839-840 (1992).
Conquest is the taking of possession of enemy territory through force, followed by
formal annexation of the defeated territory by the conqueror. See Parry & Grant
Encyclopaedic Dictionary of International Law 96 (2000).
Neither of these two modes of territorial acquisition has much immediate
relevance today. As to discovery, there are virtually no unknown territories on
earth (what about a new volcanic island emerging in the high seas?), and terri-
tories beyond the earth are governed by special treaties and agreements placing
the moon and other celestial bodies outside the reach of national appropriation.
As to conquest, it has come to be proscribed by contemporary international law
as a method of territorial acquisition. 4 Encyclopedia of Public International Law,
supra.
In earlier times, though, discovery and conquest were of great importance,
as Johnson v. M’Intosh suggests. In that case the two doctrines worked in concert.
Discovery, Marshall wrote, “gave an exclusive right to extinguish the Indian title

2. Mention of tracing introduces the idea of a chain of title: The links in the chain are the transactions
(conveyances) by which a parcel of land moves from owner to owner over time. The significance and operation
of chain of title are examined in Chapters 8 and 9 of this book.
3. John Marshall (1755-1835), the fourth Chief Justice of the United States (from 1801 to 1835), is one
of the great figures in the constitutional history of the United States. Marshall had little formal education (and
only six weeks of formal legal training!) but had a remarkable mind and character. He was prominent as a diplo-
mat, as a legislator, and as Secretary of State before being nominated as Chief Justice by President John Adams.
A strong defender of the Constitution, the architect of the doctrine of judicial review, “Marshall raised the office
[of Chief Justice] and the Supreme Court to stature and power previously lacking.” Under his leadership, the
practice of individual opinions by individual justices largely ceased, dissents were discouraged, and the “Court
came to speak with one voice. Usually the voice was Marshall’s.” The quotations are from Robert Faulkner’s
essay on Marshall in 4 Encyclopedia of the American Constitution 1672-1676 (2000).
12

of occupancy, either by purchase or by conquest.”4 See page 7. The first “discov-


erer” had a preemptive right to deal with the Indians, as against subsequent “dis-
coverers.” But why did discovery play any role at all? In principle, only a res nullius
or terra nullius (a thing or territory belonging to no one), a “hitherto unknown
territory,” can be discovered. See 4 Encyclopedia of Public International Law,
supra. North America in the fifteenth century was not unknown to its indigenous
occupants. Why didn’t it belong to them?
The answer is discomfiting. During the so-called classical era of discovery
(1450-1600), prior possession by aboriginal populations (which were sometimes
called savage populations, or semi-civilized ones) was commonly thought not to
matter. “In previous centuries European international lawyers were sometimes
reluctant to admit that non-European societies could constitute states for the
purposes of international law, and territory inhabited by non-European peoples
was sometimes regarded as terra nullius.” Peter Malanczuk, Akehurst’s Modern
Introduction to International Law 148 (7th ed. 1997). Marshall was alluding to
this attitude when he said of North America that “the character and religion of its
inhabitants afforded an apology for considering them as a people over whom the
superior genius of Europe might claim an ascendency.”5 See page 4.
For more on the historical context of Johnson v. M’Intosh, see Blake Watson,
Buying America from the Indians: Johnson v. McIntosh and the History of Native
Land Rights (2012); Robert J. Miller, Native America, Discovered and Conquered:
Thomas Jefferson, Lewis & Clark, and Manifest Destiny (2006). We shall return to
the subject shortly, after considering some additional reasons to begin a study of
property with Johnson v. M’Intosh.
3. Occupancy theory and the principle of first in time.  The doctrine of discovery
at work in Johnson may be of little importance today, but exactly the opposite is
true of the doctrine’s foundation — the principle of first in time.
“The notion that being there first somehow justifies ownership rights is a ven-
erable and persistent one.” Lawrence C. Becker, Property Rights: Philosophical
Foundations 24 (1977). The theory of first occupancy, or first possession, dates
back to Roman law and played a considerable part in the writings of Hugo Grotius
and Samuel Pufendorf in the seventeenth century (you will soon bump into these
figures again; see pages 20-21, 25). As Grotius saw it, the riches of the earth were
initially held in common (nothing belonged to any one individual). But because
avarice eventually led to scarcity, the institution of private property became nec-
essary to preserve peace. Private ownership was imagined to have developed
according to agreements, explicit ones or those implied by occupation; it was to
be “supposed” that whatever each person had taken possession of should be that

4. Note that the modern indictment of acquisition by conquest is not “regarded as being retroactive to
titles made by conquest in an earlier period.” Robert Y. Jennings, The Acquisition of Territory in International
Law 56 (1963).
5. The sarcasm and irony seen here and elsewhere in Marshall’s opinion suggest his embarrassment
with what he had to write, and there is independent evidence that he was sympathetic to the plight of Native
Americans. In an 1828 letter to Justice Joseph Story, for example, Marshall mentioned some reasons to be forgiv-
ing of the “conduct of our forefathers in expelling the original occupants of the soil,” but went on to state his
view that “every oppression now exercised on a helpless people depending on our magnanimity and justice for
the preservation of their existence impresses a deep stain on the American character.” Quoted in The Political
and Economic Doctrines of John Marshall 124-125 (John E. Oster ed., 1914).
13

John Marshall
Chief Justice of the United States, 1801-1835
by Chester Harding (1828)
Collection of the Boston Athenaeum
14

person’s property. Eventually, systems of government were introduced (how?),


and the original rules of acquisition were modified. Still, though, the government
had to recognize the pre-established property rights of its citizens.

[T]he institution of private property really protected men’s natural equality of


rights. “Now property ownership was introduced for the purpose of preserving
equality to this end, in fact, that each should enjoy his own.” But what is this “own”
to which each man has an equal right? . . . In fact, the “own” which the laws of prop-
erty protect is whatever an individual has managed to get hold of, and equality of
right, applied to property, means only that every man has an equal right to grab.
The institution of property was an agreement among men legalizing what each had
already grabbed, without any right to do so, and granting, for the future, a formal
right of ownership to the first grabber. As a result of this agreement, which, by a
remarkable oversight, puts no limit on the amount of property any one person may
occupy, everything would soon pass into private ownership, and the equal right to
grab would cease to have any practical value. [Richard Schlatter, Private Property:
The History of an Idea 130-131 (1951).]6

Occupancy fares rather well as a positive (descriptive or explanatory) the-


ory of the origins of property. Sir William Blackstone put it to that use in his
famous Commentaries on the Laws of England, completed a few years before
the American Revolution (see page 25). See also Richard A. Epstein, Possession
as the Root of Title, 13 Ga. L. Rev. 1221, 1222 (1979) (the common and civil law
alike adopted the proposition that “taking possession of unowned things is the
only possible way to acquire ownership of them”; the universal principle is “origi-
nal possession”). And, as Becker observed above, the idea that being prior in time
matters is not only “venerable” but “persistent.” You will see it running through-
out the materials in this book, particularly in the next section on Acquisition
by Capture. For an overview of its active role in contemporary property law, see
Lawrence Berger, An Analysis of the Doctrine that “First in Time Is First in Right,”
64 Neb. L. Rev. 349 (1985).
Despite its persistence, however, the normative case for first possession — its
force as a justification — is commonly thought to be rather weak. See Morris
Cohen, Property and Sovereignty, 13 Cornell L.Q. 8, 15-16 (1927). But Cohen
was not single-minded; he did find “a kernel of value” in the principle. Epstein
provides a more spirited defense in his essay on Possession as the Root of Title,
supra. See also Richard A. Epstein, Past and Future: The Temporal Dimension
in the Law of Property, 64 Wash. U. L.Q. 667 (1986). Can you anticipate the

6. For implicit disagreement with Schlatter’s account, see Adam Mossoff, What Is Property? Putting the
Pieces Back Together, 45 Ariz. L. Rev. 371, 379-386 (2003), arguing that the words “one’s own” in the arguments
of Grotius and Pufendorf refer not just to what one can get hold of, but to the idea that one has a right to life
and liberty, and that actions based on this right are necessary and sufficient to create a right of property. John
Locke’s labor theory, to which we will turn momentarily, begins with the same theoretical starting point.
We will be making brief reference to various philosophical perspectives on property from time to time.
The literature on the general subject is vast, but the following short list might prove useful to interested stu-
dents: Becker, supra; C.B. Macpherson, Property: Mainstream and Critical Positions (1978); Stephen R. Munzer,
A Theory of Property (1990); J.E. Penner, The Idea of Property in Law (1997); Alan Ryan, Property (1987); Alan
Ryan, Property and Political Theory (1984); Schlatter, supra; Jeremy Waldron, The Right to Private Property
(1988); Theories of Property (Anthony Parel & Thomas Flanagan eds., 1979); and the essays collected in
Property, 22 Nomos (1980).
15

arguments in these articles, constructing for yourself a list of the pros and cons
of first in time?
4. Labor theory and John Locke.  The famous philosopher John Locke (1632-
1704) drew first occupancy into his labor theory of property, but in a way that was
thought to give it greater moral weight. The problem is this: So what if someone
possesses something first; why should anyone else be obliged to respect the claim
of the first possessor? Locke reasoned that the obligation “was imposed by the
law of nature, and bound all men fast long before mere human conventions had
been thought of.” Schlatter, supra, at 154. Here is a slightly modernized state-
ment of the core of Locke’s argument:

Though the earth and all inferior creatures be common to all men, yet every man
has a property in his own person. This nobody has any right to but himself. The labor
of his body, and the work of his hands, we may say, are properly his. Whatsoever then
he removes out of the state that nature has provided, and left it in, he has mixed
his labor with, and joined to it something that is his own, and thereby makes it his
property. It being by him removed from the common state nature placed it in, has
by this labor something annexed to it, that excludes the common right of other
men. For this labor being the unquestionable property of the laborer, no man but
he can have a right to what that is once joined to, at least where there is enough,
and as good left in common for others. [John Locke, Two Treatises of Government,
Book II, Ch. V (1690).]

Locke’s labor theory appears in several versions, most of them deficient in


one respect or another. Like what? See Carol M. Rose, Property and Persuasion
11 (1994) (why does one own one’s labor? In any event, how broad is the right
that one establishes by mixing one’s labor with something else?). Still, though,
labor theory has its appeal, and the law of property continues to feel its influ-
ence (just as with its forerunner, occupancy theory). See Eric R. Claeys, Labor,
Exclusion, and Flourishing in Property Law, 95 N.C. L. Rev. 413 (2017) (devel-
oping a Lockean productive labor account of property law). We mention a few
examples here as an aside and ask you to watch for others as your studies progress.
Consider, then, the law of accession, which comes into play when one person
adds to the property of another: by labor alone, A chopping B’s trees and making
flower boxes from them; by labor and the addition of new material, C using her
own oils and D’s canvas to produce a valuable painting. As between A and B, or
C and D, which party is entitled to the final product? Is the other party entitled
to damages equal to the value of his or her contribution? These issues look to
be simple ones, but they are not. What factors do you suppose the courts would
consider in resolving them? See Ray A. Brown, The Law of Personal Property
49-62 (Walter V. Raushenbush ed., 3d ed. 1975). For an interesting theoretical
analysis of the law of accession, see Thomas W. Merrill, Accession and Original
Ownership, 1 J. Legal Analysis 459 (2009). A particular virtue of Merrill’s treat-
ment is that it shows a number of connections between accession and several
other topics considered in the first three chapters of this book.
Another illustration of labor theory at work is found in Haslem v. Lockwood,
37 Conn. 500 (1871), where the plaintiff had raked into heaps manure that had
accumulated in a public street, intending to carry it away the next day. Before
16

he could do so, the defendant found the heaps of manure and hauled them off
in his cart. In an action in trover for the value of the manure, the court held for
the plaintiff. The manure belonged originally to the owners of the animals that
dropped it, but had been abandoned. As abandoned property, it belonged to the
first occupant, the plaintiff, who “had changed its original condition and greatly
enhanced its value by his labor. . . .” 37 Conn. at 506. The defendant argued that
the plaintiff had lost his rights when he left the heaps unattended overnight. The
court asked, “if a party finds property comparatively worthless .  .  . and greatly
increases its value by his labor and expense, does he lose his right if he leaves it a
reasonable time to procure the means to take it away, when such means are neces-
sary for its removal?” 37 Conn. at 507. Answer: No.
5. John Locke and Johnson v. M’Intosh.  Return now to the Johnson case where
we left it at the end of Note 2 above. Locke appears to have shared the common
European view that the Native Americans had no substantial claim to the New
World they had so long occupied.

[He] reasoned that the Indians’ occupancy of their aboriginal lands did not involve
an adequate amount of “labor” to perfect a “property” interest in the soil. His argu-
ment helped frame and direct later liberal debates in colonial America on the natu-
ral rights of European agriculturists to dispossess tribal societies of their land base.
[Robert A. Williams, Jr., The Medieval and Renaissance Origins of the Status of the
American Indian in Western Legal Thought, 57 S. Cal. L. Rev. 1, 3 n.4 (1983).]

See generally Robert A. Williams, Jr., The American Indian in Western Legal
Thought (1990).
Notwithstanding the foregoing, there is considerable evidence that American
lawyers and government officials actually did, for a time, regard the Indians as
owners of their lands. See Stuart Banner, How the Indians Lost Their Land: Law
and Power on the Frontier (2005). In a detailed and very convincing account,
Professor Banner shows that acknowledgment of Indian ownership was common
in the early 1790s. But by the time of the decision in Johnson some 30 years later,
conventional wisdom was to the opposite effect: The Indians were not owners
but merely had a right of occupancy. “A major change in American legal thought
had taken place during the intervening three decades. . . . Like many transforma-
tions in legal thought, this one was so complete that contemporaries often failed
to notice that it had occurred. They came to believe instead that they were sim-
ply following the rule laid down by their English colonial predecessors, and that
the Indians had never been accorded full ownership of their land. And that view,
expressed most prominently by the Supreme Court in Johnson v. M’Intosh, has per-
sisted right up until today.” Id. at 150. Rights to land flowed from the legitimate
sovereign government, and only from that source.
Some recent historical scholarship helps explain these developments.
See Gregory Ablavsky, The Rise of Federal Title, 106 Cal. L. Rev. __ (forthcom-
ing 2018), available at https://papers.ssrn.com/sol3/papers.cfm?abstract_
id=2998435. Ablavsky notes that in 1763, the English crown prohibited both
individuals and the colonies from purchasing western lands from the Indians,
though speculators continued to make such purchases despite the legal
17

prohibitions. During the decades that followed, two groups of speculators pur-
chased millions of acres of land in the West: The Transylvania Company bought
from the Cherokees, and the Illinois & Wabash Company purchased from the
Illinois and Piankeshaw Indians. Id. at 16. Both companies made their purchases
shortly before the onset of the Revolutionary War, and while they knew the pur-
chases were invalid under English law, they guessed that a new government might
soon be in charge, one that could prove more sympathetic to their claims to title.
After the war was won, these companies lobbied the states to recognize their
claims, to no avail. (Virginia’s government officials wanted to be in charge of allo-
cating the Commonwealth’s western landholdings themselves.) So the would-be
landowners took their fight to Congress, where they waged a long but unsuccessful
battle to win recognition of their landholdings. Id. at 25. With Congress’s final,
definitive rejection in 1811, the companies (and M’Intosh, who claimed title to
smaller but still substantial swaths of land, as the map on page 8 shows) turned to
their last resort: the federal courts, culminating with the decision in Johnson. As
Ablavsky writes, the decision “was unsurprising, given that the companies’ claim
had already been adjudicated, and rejected, by three separate sovereigns.” Id.
Johnson hardly settled everything. State records regarding who controlled
what were a mess. States eventually ceded most of their public lands to the federal
government, which was forced to settle numerous disputes among conflicting
claimants. For example, western land had been promised to revolutionary war
veterans, and while many veterans sold their landholdings willingly, others had
been swindled. Id. at 32-33. In Kentucky, meanwhile, grants had been issued by
the government to more than 24 million acres of land, “twice as much land as
the state contained[!]” Id. at 18. Meanwhile, a recurring problem arose when
states granted white men rights to land still occupied by Indians, and the federal
government later promised those same lands to Indian tribes by treaty. Congress
and Thomas Jefferson (then Secretary of State) were for the most part hostile
to the claims of those tracing their title to state grants in these circumstances.
See Lindsay G. Robertson, Conquest by Law: How the Discovery of America
Dispossessed Indigenous Peoples of Their Land 106-109 (2005). All these disputes
over title gave rise to an avalanche of litigation. Real property disputes comprised
a sizeable percentage of the Supreme Court’s docket between 1815 and 1835,
becoming the largest category of non-constitutional cases. Ablavsky, supra, at 19.
Notice finally that in the penultimate paragraph of the Johnson opinion
(page 10) the Court recognized an Indian title of occupancy, which only the
government could purchase. Given that the European settlers had such superior
might, why did they not instead simply conquer the Indians altogether, and grant
them nothing? A persuasive answer is suggested in Eric Kades, The Dark Side of
Efficiency: Johnson v. M’Intosh and the Expropriation of American Indian Lands,
148 U. Pa. L. Rev. 1065 (2000). Professor Kades argues that the settlers’ objective
was efficient expropriation; they wanted to get land at the least cost to themselves,
with cost defined broadly to include lives lost in battle, diversion of capital to mili-
tary production, and so on. In this light, purchase was often the cheapest course.
To see why, consider that the decision in Johnson, echoing a long line of colonial
statutes, royal proclamations, and administrative rulings, decreed that the sov-
ereign (first Britain, then the United States) was the only buyer empowered to
18

purchase Indian lands. The government was a so-called monopsonist — a sole


buyer — and this fact helped reduce the price paid for the Indian title of occu-
pancy. Moreover, major portions of early American land law (favorable financing,
squatters’ rights, and Homestead Acts) had the purpose and effect of weaken-
ing Indian resistance by luring settlers to the frontier. They brought with them
European diseases against which tribes had no immunity; they cleared land and
hunted prodigiously to get hides and fur. A native population decimated by sick-
ness and deprived of sources of food and other necessities had little bargaining
power. The title of occupancy went for a pittance. See also Eric Kades, History
and Interpretation of the Great Case of Johnson v. M’Intosh, 19 Law & Hist. Rev.
67 (2001).
Despite the ongoing force of Johnson v. M’Intosh, scholars continue to con-
test its rationale and contemporary relevance. A summary of the critical commen-
tary is provided in the final chapter of Blake Watson’s book, supra. See also Blake
Watson, The Doctrine of Discovery and the Elusive Definition of Indian Title, 15
Lewis & Clark L. Rev. 995 (2011). Watson argues that the nature of Indian title is
unique, with no analogies in American law. A contrary view is offered in Michael
C. Blumm, Why Aboriginal Title Is a Fee Simple Absolute, 15 Lewis & Clark L.
Rev. 975 (2011). Professor Blumm argues that the problem with Johnson is more
in its interpretation by other courts than in what the case actually held. Justice
Marshall, he believes, aimed to protect native land rights as much as he thought
possible.
6. Property and power. Property confers and rests upon power. It bestows on
owners a form of sovereignty over others, because property means that the sov-
ereign state stands behind the owners’ assertions of right.7 But as Morris Cohen
observed:

[T]he recognition of private property as a form of sovereignty is not itself an argu-


ment against it [for] some form of government we must always have.  .  .  . While,
however, government is a necessity, not all forms of it are of equal value. At any rate
it is necessary to apply to the law of property all those considerations of social ethics
and enlightened public policy which ought to be brought to the discussion of any
just form of government. [Cohen, supra, at 14.]

In this respect, the ongoing history of relations between Native Americans


and the U.S. government has not been a very happy one. “That there was tragedy,
deception, barbarity, and virtually every other vice known to man in the 300-year
history of the expansion of the original 13 Colonies into a Nation which now
embraces more than three million square miles and 50 States cannot be denied.”

7. See Gregory S. Alexander, Time and Property in the American Republican Legal Culture, 66 N.Y.U.
L. Rev. 273, 277 (1991):
[W]hile the liberal vision underlying individual property rights depicts the self as separated from
politics, it is politics that defines the personal sphere — individual property rights depend on state power.
Moreover, property is inescapably relational. When the state recognizes and enforces one person’s
property right, it simultaneously denies property rights in others. Thus the owner’s security as to par-
ticular assets comes at the expense of others being vulnerable to the owner’s control over those assets.
Ownership is power over persons, not merely things.
19

This is the view of then-Justice (now late Chief Justice) William Rehnquist, stated
in a dissenting opinion written some 150 years after Johnson v. M’Intosh. See
United States v. Sioux Nation of Indians, 448 U.S. 371, 437 (1980).
7. Epilogue and prologue.  See Rose, supra, at 19-20:

[P]erhaps the deepest aspect of the common law text of possession lies in the
attitude that this text strikes with respect to the relationship between human beings
and nature. At least some Indians professed bewilderment at the concept of own-
ing the land. Indeed they prided themselves on not marking the land but rather on
moving lightly through it, living with the land and with its creatures as members of
the same family rather than as strangers who visited only to conquer the objects of
nature. The doctrine of first possession, quite to the contrary, reflects the attitude
that human beings are outsiders to nature. It gives the earth and its creatures over
to those who mark them so clearly as to transform them, so that no one else will
mistake them for unsubdued nature.
To be sure, we may admire nature and enjoy wildness. But those sentiments
find little resonance in the doctrine of first possession. Its texts are those of culti-
vation, manufacture, and development. We cannot have our fish both loose and
fast, as Herman Melville might put it. The common law of first possession makes
a choice. The common law gives preference to those who convince the world that
they can catch the fish and hold it fast. This may be a reward to useful labor, but it is
more precisely the articulation of a specific vocabulary within a structure of symbols
understood by a commercial people. It is this commonly understood and shared set
of symbols that gives significance and form to what might seem the quintessentially
individualistic act: the claim that one has, by “possession,” separated for one’s self
property from the great commons of unowned things.

B. Acquisition by Capture

Pierson v. Post
Supreme Court of New York, 1805
3 Cai. R. 175, 2 Am. Dec. 264

This was an action of trespass on the case commenced in a justice’s court, by the
present defendant against the now plaintiff.
The declaration stated that Post, being in possession of certain dogs and
hounds under his command, did, “upon a certain wild and uninhabited, unpos-
sessed and waste land, called the beach, find and start one of those noxious beasts
called a fox,” and whilst there hunting, chasing and pursuing the same with his
dogs and hounds, and when in view thereof, Pierson, well knowing the fox was so
hunted and pursued, did, in the sight of Post, to prevent his catching the same,
kill and carry it off. A verdict having been rendered for the plaintiff below, the
defendant there sued out a certiorari, and now assigned for error, that the declara-
tion and the matters therein contained were not sufficient in law to maintain an
action. . . .
20

Tompkins, J., delivered the opinion of the court.8 This cause comes before us on a
return to a certiorari directed to one of the justices of Queens county.
The question submitted by the counsel in this cause for our determination
is, whether Lodowick Post, by the pursuit with his hounds in the manner alleged
in his declaration, acquired such a right to, or property in, the fox, as will sustain
an action against Pierson for killing and taking him away?
The cause was argued with much ability by the counsel on both sides, and
presents for our decision a novel and nice question. It is admitted that a fox is an
animal ferae naturae, and that property in such animals is acquired by occupancy
only. These admissions narrow the discussion to the simple question of what acts
amount to occupancy, applied to acquiring right to wild animals?
If we have recourse to the ancient writers upon general principles of law, the
judgment below is obviously erroneous. Justinian’s Institutes, lib. 2, tit. 1, s.13,
and Fleta, lib. 3, c.2, p. 175, adopt the principle, that pursuit alone vests no prop-
erty or right in the huntsman; and that even pursuit, accompanied with wound-
ing, is equally ineffectual for that purpose, unless the animal be actually taken.
The same principle is recognised by Bracton, lib. 2, c.1, p. 8.
Puffendorf, lib. 4, c.6, s.2, and 10, defines occupancy of beasts ferae naturae, to
be the actual corporal possession of them, and Bynkershoek is cited as coinciding in
this definition. It is indeed with hesitation that Puffendorf affirms that a wild beast
mortally wounded, or greatly maimed, cannot be fairly intercepted by another, whilst
the pursuit of the person inflicting the wound continues. The foregoing authorities
are decisive to show that mere pursuit gave Post no legal right to the fox, but that he
became the property of Pierson, who intercepted and killed him.
It therefore only remains to inquire whether there are any contrary princi-
ples, or authorities, to be found in other books, which ought to induce a different
decision. Most of the cases which have occurred in England, relating to property
in wild animals, have either been discussed and decided upon the principles of
their positive statute regulations, or have arisen between the huntsman and the
owner of the land upon which beasts ferae naturae have been apprehended; the
former claiming them by title of occupancy, and the latter ratione soli. Little satis-
factory aid can, therefore, be derived from the English reporters.
Barbeyrac, in his notes on Puffendorf, does not accede to the definition of
occupancy by the latter, but, on the contrary, affirms, that actual bodily seizure
is not, in all cases, necessary to constitute possession of wild animals. He does
not, however, describe the acts which, according to his ideas, will amount to an
appropriation of such animals to private use, so as to exclude the claims of all
other persons, by title of occupancy, to the same animals; and he is far from aver-
ring that pursuit alone is sufficient for that purpose. To a certain extent, and as
far as Barbeyrac appears to me to go, his objections to Puffendorf’s definition of

8. Daniel Tompkins (1774-1825) was an important figure in the early Republic, especially in New York
politics. A self-made man of humble origins, he graduated first in his class from Columbia College. He was an
enormously popular figure with the electorate, served twice as Governor of New York State (1807-1817), and was
the sixth Vice President of the United States (1817-1825) during James Monroe’s administration. Throughout
his public service Tompkins had serious financial problems and was a heavy drinker. During his tenure as Vice-
President he occasionally presided over the Senate while inebriated. He died in 1825, disgraced, deeply in debt,
and probably alcoholic. See Ray W. Irwin, Daniel D. Tompkins: Governor of New York and Vice President of the
United States (1968). — Eds.
21

occupancy are reasonable and correct. That is to say, that actual bodily seizure is
not indispensable to acquire right to, or possession of, wild beasts; but that, on
the contrary, the mortal wounding of such beasts, by one not abandoning his pur-
suit, may, with the utmost propriety, be deemed possession of him; since, thereby,
the pursuer manifests an unequivocal intention of appropriating the animal to
his individual use, has deprived him of his natural liberty, and brought him within
his certain control. So also, encompassing and securing such animals with nets
and toils, or otherwise intercepting them in such a manner as to deprive them of
their natural liberty, and render escape impossible, may justly be deemed to give
possession of them to those persons who, by their industry and labour, have used
such means of apprehending them. Barbeyrac seems to have adopted, and had
in view of his notes, the more accurate opinion of Grotius, with respect to occu-
pancy. . . . The case now under consideration is one of mere pursuit, and presents
no circumstances or acts which can bring it within the definition of occupancy by
Puffendorf, or Grotius, or the ideas of Barbeyrac upon that subject.
The case cited from 11 Mod. 74-130, I think clearly distinguishable from the
present; inasmuch as there the action was for maliciously hindering and disturbing
the plaintiff in the exercise and enjoyment of a private franchise; and in the report
of the same case, (3 Salk. 9) Holt, Ch. J., states, that the ducks were in the plaintiff
‘s decoy pond, and so in his possession, from which it is obvious the court laid much
stress in their opinion upon the plaintiff ‘s possession of the ducks, ratione soli.
We are the more readily inclined to confine possession or occupancy of beasts
ferae naturae, within the limits prescribed by the learned authors above cited, for
the sake of certainty, and preserving peace and order in society. If the first seeing,
starting, or pursuing such animals, without having so wounded, circumvented or
ensnared them, so as to deprive them of their natural liberty, and subject them to the
control of their pursuer, should afford the basis of actions against others for inter-
cepting and killing them, it would prove a fertile source of quarrels and litigation.
However uncourteous or unkind the conduct of Pierson towards Post, in
this instance, may have been, yet his act was productive of no injury or damage
for which a legal remedy can be applied. We are of opinion the judgment below
was erroneous, and ought to be reversed.

Livingston, J.9 My opinion differs from that of the court. Of six exceptions, taken
to the proceedings below, all are abandoned except the third, which reduces the
controversy to a single question.
Whether a person who, with his own hounds, starts and hunts a fox on waste
and uninhabited ground, and is on the point of seizing his prey, acquires such an
interest in the animal, as to have a right of action against another, who in view of
the huntsman and his dogs in full pursuit, and with knowledge of the chase, shall
kill and carry him away?

9. Professor Craig Oren has informed us that Livingston, J., was probably Henry Brockholst Livingston
(1757-1823). Born into a socially prominent family in New York City, he served in the American Revolution and
later as assistant to John Jay when Jay was minister to Spain. Coming back from Spain, Livingston was captured
by the British but subsequently released. During his career as a lawyer he became an ardent Jeffersonian and
wrote a number of newspaper articles opposing Jay’s Treaty. In 1806, President Jefferson appointed him to the
U.S. Supreme Court, where he served until his death.
22

This is a knotty point, and should have been submitted to the arbitration
of sportsmen, without poring over Justinian, Fleta, Bracton, Puffendorf, Locke,
Barbeyrac, or Blackstone, all of whom have been cited; they would have had no
difficulty in coming to a prompt and correct conclusion. In a court thus consti-
tuted, the skin and carcass of poor reynard would have been properly disposed of,
and a precedent set, interfering with no usage or custom which the experience of
ages has sanctioned, and which must be so well known to every votary of Diana.
But the parties have referred the question to our judgment, and we must dispose
of it as well as we can, from the partial lights we possess, leaving to a higher tribu-
nal, the correction of any mistake which we may be so unfortunate as to make. By
the pleadings it is admitted that a fox is a “wild and noxious beast.” Both parties
have regarded him, as the law of nations does a pirate, “hostem humani generis,”
and although “de mortuis nil nisi bonum,” be a maxim of our profession, the mem-
ory of the deceased has not been spared. His depredations on farmers and on
barn yards have not been forgotten; and to put him to death wherever found, is
allowed to be meritorious, and of public benefit. Hence it follows, that our deci-
sion should have in view the greatest possible encouragement to the destruction
of an animal, so cunning and ruthless in his career. But who would keep a pack of
hounds; or what gentleman, at the sound of the horn, and at peep of day, would
mount his steed, and for hours together, “sub jove frigido,” or a vertical sun, pursue
the windings of this wily quadruped, if, just as night came on, and his stratagems
and strength were nearly exhausted, a saucy intruder, who had not shared in the
honours or labours of the chase, were permitted to come in at the death, and
bear away in triumph the object of pursuit? Whatever Justinian may have thought
of the matter, it must be recollected that his code was compiled many hundred
years ago, and it would be very hard indeed, at the distance of so many centuries,
not to have a right to establish a rule for ourselves. In his day, we read of no order
of men who made it a business, in the language of the declaration in this cause,
“with hounds and dogs to find, start, pursue, hunt, and chase,” these animals, and
that, too, without any other motive than the preservation of Roman poultry; if
this diversion had been then in fashion, the lawyers who composed his institutes
would have taken care not to pass it by, without suitable encouragement. If any
thing, therefore, in the digests or pandects shall appear to militate against the
defendant in error, who, on this occasion, was the foxhunter, we have only to say
tempora mutantur; and if men themselves change with the times, why should not
laws also undergo an alteration?
It may be expected, however, by the learned counsel, that more particular
notice be taken of their authorities. I have examined them all, and feel great
difficulty in determining, whether to acquire dominion over a thing, before in
common, it be sufficient that we barely see it, or know where it is, or wish for it,
or make a declaration of our will respecting it; or whether, in the case of wild
beasts, setting a trap, or lying in wait, or starting, or pursuing, be enough; or if an
actual wounding, or killing, or bodily tact and occupation be necessary. Writers
on general law, who have favoured us with their speculations on these points,
differ on them all; but, great as is the diversity of sentiment among them, some
conclusion must be adopted on the question immediately before us. After mature
deliberation, I embrace that of Barbeyrac, as the most rational, and least liable
23

to objection. If at liberty, we might imitate the courtesy of a certain emperor,


who, to avoid giving offence to the advocates of any of these different doctrines,
adopted a middle course, and by ingenious distinctions, rendered it difficult to
say (as often happens after a fierce and angry contest) to whom the palm of vic-
tory belonged. He ordained, that if a beast be followed with large dogs and hounds,
he shall belong to the hunter, not to the chance occupant; and in like manner, if
he be killed or wounded with a lance or sword; but if chased with beagles only, then
he passed to the captor, not to the first pursuer. If slain with a dart, a sling, or a
bow, he fell to the hunter, if still in chase, and not to him who might afterwards
find and seize him.
Now, as we are without any municipal regulations of our own, and the pur-
suit here, for aught that appears on the case, being with dogs and hounds of
imperial stature, we are at liberty to adopt one of the provisions just cited, which
comports also with the learned conclusion of Barbeyrac, that property in animals
ferae naturae may be acquired without bodily touch or manucaption, provided the
pursuer be within reach, or have a reasonable prospect (which certainly existed
here) of taking, what he has thus discovered with an intention of converting to
his own use.10
When we reflect also that the interest of our husbandmen, the most useful
of men in any community, will be advanced by the destruction of a beast so per-
nicious and incorrigible, we cannot greatly err, in saying, that a pursuit like the
present, through waste and unoccupied lands, and which must inevitably and
speedily have terminated in corporal possession, or bodily seisin, confers such a
right to the object of it, as to make any one a wrongdoer, who shall interfere and
shoulder the spoil. The justice’s judgment ought, therefore, in my opinion, to be
affirmed.
Judgment of reversal.

NOTES AND QUESTIONS

1. The famous fox.  Pierson v. Post, one of the old chestnuts of property law,11
has figured in a flurry of law review articles:
Bethany R. Berger, It’s Not about the Fox: The Untold History of Pierson v.
Post, 55 Duke L.J. 1089 (2006), speculates that the real dispute in the case had

10. The tone of Livingston’s dissent probably reflects an intention on his part to mock the majority’s
pedantry and the seriousness with which a dispute over such a trivial piece of property was being litigated. But
he would have done well to pay closer attention to the views of at least one classic figure, John Locke (recall
Note 4 on page 15), who was cited by the parties, and argued from his labor theory of property that on facts like
those in Pierson, a wild animal should rightly go to the person who first invested labor in pursuit, notwithstand-
ing capture had not yet been achieved. See John Locke, Two Treatises of Government, Book II, §30 (1690): “[T]
he hare that anyone is hunting, is thought his who pursues her during the chase. For being a beast that is still
looked upon as common, . . . whoever has employed so much labor about any of that kind, as to find and pursue
her, has thereby removed her from the state of nature, wherein she was common, and hath begun a property.”
11. Pierson’s first appearance in a property casebook apparently dates to 1893. See Stuart Banner, 21st
Century Fox: Pierson v. Post Then and Now, 27 L. & Hist. Rev. 185, 186 (2009). The first casebook to include the
dissent, however, appeared in 1951. See Angela Fernandez, Fuzzy Rules and Clear Enough Standards: The Uses
and Abuses of Pierson v. Post, 63 U. Toronto L.J. 97, 112 (2013).
24

little to do with rights to a fox; the issue, rather, was whether the use of local com-
mon areas should be determined by the tastes of the newly wealthy (Post) or the
old agricultural traditionalists (Pierson).
Andrea McDowell, Legal Fictions in Pierson v. Post, 105 Mich. L. Rev. 735
(2007), argues that the dispute was a torts case in disguise. Neither party actu-
ally wanted the fox. Post simply wanted to run a hunt free of interference from
others, whereas Pierson’s aim was to get rid of varmints, not gain possession of
them.
Angela Fernandez, The Lost Record of Pierson v. Post, the Famous Fox Case,
27 Law & Hist. Rev. 149 (2009), relates the author’s discovery in 2008 of the
long-lost judgment roll in the case and describes various previously unknown
points of interest disclosed by the record — for example, the date of the incident
(December 10, 1802); a description of the jury trial before a justice of the peace
where the parties appeared without lawyers on December 30, 1802; the amount
of damages Post claimed (up to $25) and was awarded (75¢ by the jury and $5 in
costs); the amount Pierson won on appeal ($121.37); confirmation of the names
of the lawyers; and all six grounds of appeal claimed by Pierson’s lawyer, Nathan
Sanford, which included allegations of some serious procedural error by the jus-
tice of the peace.
In a subsequent article, Pierson v. Post: A Great Debate, James Kent, and the
Project of Building a Learned Law for New York State, 34 Law & Soc. Inq. 301
(2009), Professor Fernandez argues that the length of time the case took to be
heard on appeal, plus the procedural error involved in the original finding for
Post, which could easily have led to a quick and simple reversal for Pierson, suggest
that something besides just the legal merits was at work in the case. The judges
and lawyers involved with it at the appellate level saw an opportunity for a learned
debate. The chief justice of the court at the time of the appeal, James Kent, dem-
onstrated considerable interest in the case, as evidenced by annotations he made
on a later copy of the case and his treatment of it in his famous Commentaries on
American Law (four volumes, 1826-1830). Professor Fernandez wonders whether
Kent might have been the mastermind behind the case in 1805. She can’t be
sure, of course, but thinks that the published report of the case (the one we
have reproduced) is best understood as a product of the intellectual interests and
schooling of the lawyers and judges involved in the appeal, who were engaged in
the project of building elaborate “high law” for the new nation.
2. At what point does one become an owner?  And how do courts decide? One
of the key issues in Pierson is whether Post did enough to acquire an ownership
interest in the fox. The court is wrestling with a difficult line-drawing problem
about how to differentiate those hunters who have “done enough” from those
who have not. This problem turns out to be present everywhere in property and
intellectual property law. See Lisa Larrimore Oullette, Pierson, Peer Review, and
Patent Law, 69 Vand. L. Rev. 1825 (2017). A second, closely related key issue in
Pierson is how to formulate that line. Should the courts articulate a property doc-
trine as a bright-line rule — a predictable, mechanical, and occasionally harsh
test that makes the outcome depend on the answers to a straightforward yes-no
question or two? Or should the courts articulate the doctrine as a flexible stan-
dard — a less predictable test that is more sensitive to context and leaves more
25

discretion in the hands of the courts to reach a desirable outcome? See Angela
Fernandez, Fuzzy Rules and Clear Enough Standards: The Uses and Abuses of
Pierson v. Post, 63 U. Toronto L.J. 97 (2013) (critiquing a common academic
account of Pierson that hypes the desirability of rules). On the comparative vir-
tues of rules and standards generally, see Louis Kaplow, Rules versus Standards:
An Economic Analysis, 42 Duke L.J. 557 (1992); Carol M. Rose, Crystals and
Mud in Property Law, 40 Stan. L. Rev. 577 (1988); Pierre J. Schlag, Rules and
Standards, 33 UCLA L. Rev. 379 (1985).
3. Formalism.  The majority and dissenting opinions in Pierson v. Post are
peppered with references to a number of obscure legal works and legal scholars.
Justinian’s Institutes is a Roman law treatise of the sixth century; Bracton was
the author of a thirteenth-century tome on English law; Fleta refers to a Latin
textbook on English law written in 1290 or thereabouts, supposedly in Fleet
prison and possibly by one of the corrupt judges Edward I put there. Barbeyrac,
Bynkershoek, Grotius, and Pufendorf (sometimes spelled Puffendorf) were
legal scholars who wrote in the seventeenth and eighteenth centuries; the last
two of them figured in our discussion of Johnson v. M’Intosh, as did John Locke,
the English philosopher (1632-1704) and William Blackstone (1723-1780). See
pages 12-16. Blackstone was the first professor of English law at an English uni-
versity. His famous Commentaries on the Laws of England (1765-1769), the
first accessible general statement of English law, was popular and influential
in both England and the United States, despite being scorned by the likes of
English philosopher Jeremy Bentham for uncritical acceptance of previous writ-
ers and blind admiration of the past. After resigning a professorship at Oxford,
Blackstone was appointed to the bench, where in a famous opinion in Perrin v.
Blake he concisely formulated the conservative creed of property lawyers of his
time: “The law of real property in this country, wherever its materials were gath-
ered, is now formed into a fine artificial system, full of unseen connexions and
nice dependencies; and he that breaks one link of the chain, endangers the dis-
solution of the whole.” 1 Francis Hargrave, Tracts Relative to the Law of England
489, 498 (1787).
4. First in time.  The discussion in Note 3 on page 12 introduced the prin-
ciple of first in time and suggested the dominant role it plays in the law of prop-
erty. Did the majority and dissenting justices in Pierson v. Post agree that first
in time was the governing principle? Note that the majority held as it did “for
the sake of certainty, and preserving peace and order in society.” See page 21.
How did its opinion (that mere chase is insufficient to confer the rights of first
possession) advance those goals? The benefits of peace and order seem obvious
enough. What are the advantages of certainty in a property system? Are there
any disadvantages in promoting certainty? Consider in this regard the dissenting
opinion of Justice Livingston, who wanted to promote the destruction of “perni-
cious beasts.” He believed that his rule would do that more effectively than the
rule of the majority opinion. Was he correct?
On the methods of reasoning reflected in the majority and dissenting opinions
in Pierson v. Post, see Linda Holdeman Edwards, The Convergence of Analogical
and Dialectic Imaginations in Legal Discourse, 20 Legal Stud. F. 7 (1996).
26

Sir William Blackstone


Attributed to Sir Joshua Reynolds
National Portrait Gallery, London

5. Custom.  Livingston was also of the view that the question in Pierson v. Post
“should have been submitted to the arbitration of sportsmen.”12 See page 22. In

12. Arbitration would no doubt have been cheaper but maybe not so satisfying to the real contestants
(who seem to have been the fathers of the plaintiff and defendant). The following recollection of Pierson v. Post
is quoted in James T. Adams, Memorials of Old Bridgehampton 166 (1916, 1962):
Jesse Pierson, son of Capt. David, . . . saw a fox run down an unused well near Peter’s Pond, and killed and
took the fox. Lodowick Post and a company with him were in pursuit and chasing the fox, and saw Jesse
with it and claimed it as theirs, while Jesse persisted in his claim. Capt. Pierson said his son Jesse should have
the fox and Capt. Post said the same of his son Lodowick and hence the law suit contested and appealed
to the highest court in the State. . . . This became the leading case often cited. . . . To the public the deci-
sion was worth its cost. To the parties, who each expended over a thousand pounds, the fox cost very dear.
But this only went to show that “the love of law suits had not entirely disappeared, although, as by this time
lawyers were employed, they were much more in the nature of luxuries.” Id. at 165.
27

that event, Post probably would have won, because “it appeared from the record
that all hunters in the region regarded hot pursuit as giving rights to take an unim-
peded first possession.” Richard A. Epstein, Possession as the Root of Title, 13 Ga.
L. Rev. 1221, 1231 (1979). The local custom, in short, was contrary to the rule
adopted by the majority. Should the majority have abided by the custom? Consider
the following case.

Ghen v. Rich
United States District Court, District of Massachusetts, 1881
8 F. 159

Nelson, J. This is a libel to recover the value of a fin-back whale. The libellant lives
in Provincetown and the respondent in Wellfleet. The facts, as they appeared at
the hearing, are as follows:

In the early spring months the easterly part of Massachusetts bay is frequented
by the species of whale known as the fin-back whale. Fishermen from Provincetown
pursue them in open boats from the shore, and shoot them with bomb-lances fired
from guns made expressly for the purpose. When killed they sink at once to the bot-
tom, but in the course of from one to three days they rise and float on the surface.
Some of them are picked up by vessels and towed into Provincetown. Some float
ashore at high water and are left stranded on the beach as the tide recedes. Others
float out to sea and are never recovered. The person who happens to find them on
the beach usually sends word to Provincetown, and the owner comes to the spot
and removes the blubber. The finder usually receives a small salvage for his services.
Try-works are established in Provincetown for trying out the oil. The business is of
considerable extent, but, since it requires skill and experience, as well as some out-
lay of capital, and is attended with great exposure and hardship, few persons engage
in it. The average yield of oil is about 20 barrels to a whale. It swims with great swift-
ness, and for that reason cannot be taken by the harpoon and line. Each boat’s crew
engaged in the business has its peculiar mark or device on its lances, and in this way
it is known by whom a whale is killed.
The usage on Cape Cod, for many years, has been that the person who kills a
whale in the manner and under the circumstances described, owns it, and this right
has never been disputed until this case. The libellant has been engaged in this busi-
ness for ten years past. On the morning of April 9, 1880, in Massachusetts bay, near
the end of Cape Cod, he shot and instantly killed with a bomb-lance the whale in
question. It sunk immediately, and on the morning of the 12th was found stranded
on the beach in Brewster, within the ebb and flow of the tide, by one Ellis, 17 miles
from the spot where it was killed. Instead of sending word to Provincetown, as is cus-
tomary, Ellis advertised the whale for sale at auction, and sold it to the respondent,
who shipped off the blubber and tried out the oil. The libellant heard of the finding
of the whale on the morning of the 15th, and immediately sent one of his boat’s
crew to the place and claimed it. Neither the respondent nor Ellis knew the whale
had been killed by the libellant, but they knew or might have known, if they had
wished, that it had been shot and killed with a bomb-lance, by some person engaged
in this species of business.
28

The libellant claims title to the whale under this usage. The respondent
insists that this usage is invalid. It was decided by Judge Sprague, in Taber v. Jenny,
8 F. Cas. 159, that when a whale has been killed, and is anchored and left with
marks of appropriation, it is the property of the captors; and if it is afterwards
found, still anchored, by another ship, there is no usage or principle of law by
which the property of the original captors is diverted, even though the whale may
have dragged from its anchorage. The learned judge says:

When the whale had been killed and taken possession of by the boat of the
Hillman, (the first taker,) it became the property of the owners of that ship, and all
was done which was then practicable in order to secure it. They left it anchored,
with unequivocal marks of appropriation.

In Bartlett v. Budd, 2 F. Cas. 966, the facts were these: The first officer of
the libellant’s ship killed a whale in the Okhotsk sea, anchored it, attached a
waif13 to the body, and then left it and went ashore at some distance for the
night. The next morning the boats of the respondent’s ship found the whale
adrift, the anchor not holding, the cable coiled round the body, and no waif or
irons attached to it. Judge Lowell held that, as the libellants had killed and taken
actual possession of the whale, the ownership vested in them. In his opinion the
learned judge says:

A whale, being ferae naturae, does not become property until a firm possession
has been established by the taker. But when such possession has become firm and
complete, the right of property is clear, and has all the characteristics of property.

He doubted whether a usage set up but not proved by the respondents,


that a whale found adrift in the ocean is the property of the finder, unless
the first taker should appear and claim it before it is cut in, would be valid,
and remarked that “there would be great difficulty in upholding a custom that
should take the property of A. and give it to B., under so very short and uncer-
tain a substitute for the statute of limitations, and one so open to fraud and
deceit.” Both the cases cited were decided without reference to usage, upon the
ground that the property had been acquired by the first taker by actual posses-
sion and appropriation.
In Swift v. Gifford, 23 F. Cas. 558, Judge Lowell decided that a custom among
whalemen in the Arctic seas, that the iron holds the whale, was reasonable and
valid. In that case a boat’s crew from the respondent’s ship pursued and struck a
whale in the Arctic ocean, and the harpoon and the line attached to it remained
in the whale, but did not remain fast to the boat. A boat’s crew from the libellant’s
ship continued the pursuit and captured the whale, and the master of the respon-
dent’s ship claimed it on the spot. It was held by the learned judge that the whale
belonged to the respondents. It was said by Judge Sprague, in Bourne v. Ashley,
an unprinted case referred to by Judge Lowell in Swift v. Gifford, that the usage

13. Worry not! To a whaler a “waif” is not a homeless child but a pole with a little flag on top. — Eds.
29

for the first iron, whether attached to the boat or not, to hold the whale was fully
established; and he added that, although local usages of a particular port ought
not to be allowed to set aside the general maritime law, this objection did not
apply to a custom which embraced an entire business, and had been concurred
in for a long time by every one engaged in the trade.
In Swift v. Gifford, Judge Lowell also said:

The rule of law invoked in this case is one of very limited application. The
whale fishery is the only branch of industry of any importance in which it is likely
to be much used, and if a usage is found to prevail generally in that business, it will
not be open to the objection that it is likely to disturb the general understanding of
mankind by the interposition of an arbitrary exception.

I see no reason why the usage proved in this case is not as reasonable as that
sustained in the cases cited. Its application must necessarily be extremely limited,
and can affect but a few persons. It has been recognized and acquiesced in for
many years. It requires in the first taker the only act of appropriation that is pos-
sible in the nature of the case. Unless it is sustained, this branch of industry must
necessarily cease, for no person would engage in it if the fruits of his labor could
be appropriated by any chance finder. It gives reasonable salvage for securing or
reporting the property. That the rule works well in practice is shown by the extent
of the industry which has grown up under it, and the general acquiescence of a
whole community interested to dispute it. It is by no means clear that without
regard to usage the common law would not reach the same result. That seems to
be the effect of the decisions in Taber v. Jenny and Bartlett v. Budd. If the fisher-
man does all that it is possible to do to make the animal his own, that would seem
to be sufficient. Such a rule might well be applied in the interest of trade, there
being no usage or custom to the contrary. Holmes, The Common Law, 217. But
be that as it may, I hold the usage to be valid, and that the property in the whale
was in the libellant.
The rule of damages is the market value of the oil obtained from the whale,
less the cost of trying it out and preparing it for the market, with interest on the
amount so ascertained from the date of conversion. As the question is new and
important, and the suit is contested on both sides, more for the purpose of hav-
ing it settled than for the amount involved, I shall give no costs.
Decree for libellant for $71.05, without costs.

NOTES AND QUESTIONS

1. A libel is the admiralty law equivalent of a lawsuit, and the libellant (or
libelant) is the equivalent of the plaintiff in an action at law. Was the custom or
usage relied upon in Ghen v. Rich essential to the libellant’s case, or would the
rule in Pierson v. Post, page 19, have served as well?
2. Custom again.  Ghen v. Rich describes several whaling customs, and evi-
dence of others can be found in a surprising array of sources, including Herman
30

Melville’s Moby-Dick Ch. 89 (1851),14 Oliver Wendell Holmes’s famous lectures


on The Common Law 212 (1881), a number of court reports, and various jour-
nals and historical accounts. Much of the literature is considered in Robert C.
Ellickson, A Hypothesis of Wealth-Maximizing Norms: Evidence from the Whaling
Industry, 5 J. Law, Econ. & Org. 83 (1989), part of a larger study on relationships
between formal law and informal norms. See Robert C. Ellickson, Order Without
Law: How Neighbors Settle Disputes (1991).
Ellickson concludes that all the supposed and actual whaling norms boiled
down to essentially three. One usage entailed the fast-fish/loose-fish under-
standing “that a claimant owned a whale, dead or alive, so long as the whale was
fastened by line or otherwise to the claimant’s boat or ship.” Another usage, iron-
holds-the-whale, “conferred an exclusive right to capture upon the whaler who
had first affixed a harpoon or other whaling craft to the body of the whale. . . .
[T]he iron did not have to be connected by a line or otherwise to the claimant,”
so long as the claimant remained in fresh pursuit. The third usage “called for the
value of the carcass to be split between the first harpooner and the ultimate seizer
by way of a reasonable salvage award to the latter.” Ellickson, Wealth-Maximizing
Norms, supra, at 89-93. Each usage, Ellickson argues, “was adapted to its particu-
lar context” — to the disparate circumstances of various whales and waters — and
all of them were developed and observed by whalers (and observed by courts,
too) as informal or extralegal property rights regimes that maximized the whal-
ers’ aggregate wealth.
So should a usage of whalers have determined the outcome of Ghen v. Rich?15
And to get back to where we began all of this (in Note 5 on page 26), should the
norms of hunters have decided Pierson v. Post? More generally, when and why
should custom matter, and when and why not? See Lisa Bernstein, Custom in the
Courts, 110 Nw. U. L. Rev. 63 (2015); Richard A. Epstein, Possession as the Root
of Title, 13 Ga. L. Rev. 1221, 1231-1236 (1979); Benjamin van Drimmelen, The
International Mismanagement of Whaling, 10 UCLA Pac. Basin L.J. 240 (1991).
3. Tragedy of the commons. At its height, whaling was the fifth largest sec-
tor in the United States economy, but by the end of the nineteenth century the
American whaling industry was in serious decline. See Derek Thompson, The
Spectacular Rise and Fall of U.S. Whaling: An Innovation Story, The Atlantic,
Feb. 22, 2012. There were many reasons for the collapse of the industry, which
Thompson details. Ellickson notes that excessive whaling has been a recurring

14. Chapter 89 of Moby-Dick bears the title “Fast-Fish and Loose-Fish.” “A Fast-Fish belongs to the party
fast to it,” Melville wrote. “A Loose-Fish is fair game for anybody who can soonest catch it.” The issue in Ghen v.
Rich was when a fish was to be considered fast and when loose.
Recall that Professor Rose alluded to all of this in the excerpt that concluded our discussion of Johnson
v. M’Intosh and the “discovery” of America (see page 19). In Moby-Dick one can find, in turn, Melville’s own
ironic allusion to the question of that discovery, again in Chapter 89: “What was America in 1492 but a Loose-
Fish, in which Columbus struck the Spanish standard by way of waifing it for his royal master and mistress?” And
“What is the great globe itself but a Loose-Fish? And what are you, reader, but a Loose-Fish and a Fast-Fish, too?”
15. In Ghen v. Rich, Judge Nelson worried that unless he sustained the usage in question, “this branch of
industry must necessarily cease, for no person would engage in it if the fruits of his labor could be appropriated
by any chance finder.” See page 29. Recall that when Justice Livingston expressed the same concern (but with
respect to foxes) in his dissenting opinion in Pierson v. Post, we questioned his reasoning. See page 25. Should
we question Judge Nelson’s? And by the way, do you agree with Nelson’s statement (on page 29) that whaling
customs “can affect but a few persons”?
31

problem throughout the last few centuries, see Ellickson, supra, at 95-96. Excessive
whaling may arise because whalers become so concerned about their near-term
economic well-being that they disregard conservation interests that will ensure
that enough whales will survive, breed, and keep populations stable.
A tragedy of the commons is a kind of collective action problem. It is in an
individual’s interest to exploit a collective resource, but it is in the community’s
interest that the collective resource be managed sustainably. Whales swimming
in the ocean were common resources. If a whaling captain killed a whale and
harvested the value from the carcass, then all the gains from the kill would go
to him and his crew. If, by contrast, a captain decided not to kill a whale that
was still part of the breeding population, the benefits of the captain’s decision
to conserve would be shared among all whalers in the vicinity (and any whales
and environmentalists too). Foregoing the kill might be best for the community,
especially in the long run, but foregoing the kill would almost certainly make
this particular captain and this particular crew worse off. And the public-spirited
captain couldn’t do anything to stop the next crew that might come along and
kill the whale before it could reproduce. The whale’s mobility makes the problem
more daunting by spreading the gains of conservation among dispersed benefi-
ciaries. It would be one thing to forego a kill in the hopes that your kinsmen,
who also whale in the area, would benefit. But benefiting whalers in a distant
sea would be less appealing. In one view, resources held in common will always
be abused, absent coercive intervention by the government. See Garrett Hardin,
The Tragedy of the Commons, 162 Science 1243 (1968). In Hardin’s words, “ruin
is the destination toward which all men rush, each pursuing his own best interest
in a society that believes in the freedom of the commons.” Id. at 1244.
Some analysts have argued that these tragic consequences do not always
occur, at least not where access to the common resource can be restricted in
some way. These scholars, notably the late Elinor Ostrom, who won the Nobel
Memorial Prize in Economic Science in 2009, have found that in a “limited-access
commons,” people are often able to cooperate with each other in arrangements
that avoid tragic consequences for the group. A limited-access commons is an
arrangement whereby a group of individuals permits each group member to
exploit the collective resource, but outsiders are prohibited from doing likewise.
Limited numbers and shared outlooks tend to reduce strategic behavior among
the group members, thus facilitating constructive collective action. See gener-
ally Elinor Ostrom, Governing the Commons: The Evolution of Institutions for
Collective Action (1990); James M. Acheson, The Lobster Gangs of Maine (1988).
4. Externalities more generally.  The tragedy of the commons illustrates
an important concept in the economic analysis of property — externalities.
Externalities exist whenever some person, say Ariel, makes a decision about how
to use resources without taking full account of the effects of the decision. Ariel
ignores some of the effects — costs or benefits that would result from a particular
activity, for example — because they fall on others. They are “external” to Ariel,
hence the label “externalities.” As a consequence of externalities, resources tend
to be misused or “misallocated,” which is to say used in one way when another
would make society as a whole better off.
32

Externalities are commonly thought of in negative terms. Air and water


pollution, overharvesting of fish and other resources in common areas, litter-
ing, and cutting in line are all examples of negative externalities (also called
“social costs”). But externalities can be positive as well. For example, think of
street performers who play melodious music in a public space, hoping for tips
from those who sit and watch. They provide a positive externality for anyone who
enjoys the performance as they walk by on their way somewhere else. Or think
of flower boxes placed in windows and other efforts to increase a home’s curb
appeal. Many of the benefits of these beautification efforts accrue to neighbors
and strangers passing through the neighborhood.
The concept of externalities is at the heart of the economic theory of prop-
erty rights, which has gained much attention over the past several decades.
According to this theory, the purpose of private property rights is to enhance
social welfare by maximizing the value of scarce resources. Property rights are
thought to perform this value-maximizing function by “internalizing externali-
ties,” to use the economics jargon — i.e., bringing the costs of the resource’s use
to bear on the user. See Harold Demsetz, Toward a Theory of Property Rights, 57
Am. Econ. Rev. 347-357 (Pap. & Proc. 1967). Property rights do this in two ways.
First, they concentrate the costs and benefits of the use on owners, giving them
greater incentives to use their own resources more efficiently. Second, property
rights reduce the costs of negotiating with others over remaining externalities. In
a commons, agreements to reduce external costs require the consent of everyone
with a right to use the resource. Such agreements encounter high transaction costs
by virtue of the sheer number of users involved.
Even if the number of users is low, however, there are other contributors to
high transaction costs. One is the problem of free-riders, which occurs when efforts
are made to extract contributions from members of a group in order to carry out
transactions that will confer collective or nonexclusive benefits on the group — on
contributors and noncontributors alike. Suppose residents of a block hire a private
constable to deter crimes, and one of the homeowners refuses to contribute to the
constable’s salary, insisting (falsely) that he does not believe the block needs a con-
stable. The neighbors cannot easily prevent the free-rider from enjoying any safety
improvements on the block. And there is a broader danger that in light of this
dynamic, other neighbors will also be tempted to free-ride, putting a heavier finan-
cial burden on the shrinking number of homeowners who elect to contribute to the
constable’s salary. If there are too many free-riders, the burden will become unsus-
tainable, and a collective benefit that is desired by everyone will not be provided.
Collective or nonexclusive effects are typical of many (but not all) externali-
ties. Another driver of transaction costs is the problem of holdouts, which arises
when payments must be made to a group in order to carry out a transaction, and
where, unless each member of the group agrees to the deal, the transaction fails
entirely. Suppose Ben wishes to change to a land use that will increase his profits by
$1,000, but will impose $50 in costs on each of his 10 neighbors. Suppose, too, that
Ben is prohibited by law from engaging in the use unless he first obtains the per-
mission of each person affected. Ben will be inclined to offer payments (between
$50 and $100) to each neighbor, but each has an incentive to “hold out” for an
exorbitantly higher amount, knowing that without his permission Ben cannot
33

pursue a venture that would be worth far more than a $100 payment. Holding out
can frustrate transactions whose completion would be beneficial to all concerned.
The general point is this: when transaction costs become sufficiently high, the
external effects of using resources are unlikely to be taken into account through
any sort of bargaining process, and the resources are likely to be misused.
5. How do property rights arise?  Consider the problem of the conscientious
whaler, discussed in Note 3 above, who obtains control over a whale that is not yet
of breeding age. Society is better off if the whaler lets the whale swim away, so it
can reproduce and then be caught years later once it has grown. But if the whale
is released back into the wild, then the whaler’s rights disappear. So says property
law, though it needn’t say that. With modern technology, we could imagine a
society in which a whaler tags a young whale with a sturdy GPS-enabled tracking
device, and the attachment of the device to the whale both makes it easier to find
the whale at a later date and establishes a claim to ownership that other whalers
recognize. Under such a regime, the proliferation of a new technology could
alter the content of property law to prevent a tragedy of the commons. The law
of whaling has not moved in that direction to date. Yet many property scholars
believe that new property rights often arise in such a fashion. For example, eco-
nomic historians have studied the development of property rights to cattle in
the Great Plains. In the eastern states, farms were small, fencing materials were
plentiful, and herds of cattle were thin. On the plains, however, huge herds of
livestock grazed over large areas of land where wood was scarce. The methods of
maintaining ownership in the East — fencing livestock in and using their natural
markings to identify them — were poorly adapted to the Great Plains states.
The situation called out for innovative approaches to property rights.
Ranchers began branding their cattle with symbols unique to each owner, and
states and counties began requiring cattle brands to be registered in a central
repository. Soon after, many Great Plains states decided that registered brands
conferred legal proof of ownership. Inventors helped solve the fencing problem
too. Before the development of barbed wire in the 1870’s, ranchers paid rela-
tively little attention to who owned which particular grazing lands. But barbed
wire made it easy for a rancher to fence off his land, keeping his own cattle in and
stray cattle away. As the cost of demarcating private land fell, the enforcement
of private property rights increased, and this in turn changed the way that cattle
were raised. For instance, fencing the open range facilitated selective breeding
of cattle. See Terry L. Anderson & P.J. Hill, The Evolution of Property Rights:
A Study of the American West, 18 J.L. & Econ. 163 (1975). As Anderson and
Hill demonstrate, property rights enforcement depends on changes in technol-
ogy, resource endowments, economies of scale, fluctuating commodity prices,
and the like. New property rights and arrangements emerge when the benefits
of innovation exceed the benefits of the status quo, taking account of transition
costs. Anderson and Hill’s work complements the aforementioned scholarship
by Demsetz, supra, who argued that private property rights displace communal
property arrangements when the gains from internalizing externalities via pri-
vate ownership exceed the costs of doing so. See Demsetz, supra, at 354. For an
argument that political factors, as well as the economic factors emphasized by
Demsetz, Anderson, and Hill, loom large in the development of private property
34

rights, see Katrina Miriam Wyman, From Fur to Fish: Reconsidering the Evolution
of Private Property, 80 N.Y.U. L. Rev. 117 (2005).
So far, so good. But all of this raises the broader question of what factors
gave rise to the first effective property regimes. That is, a willingness to recognize
property rights depends on cooperation with others — and the initial transac-
tion costs of such cooperation would have been very high in a state of nature,
where presumably might made right. Natural selection may have played a part,
rewarding those individuals and tribes that deferred to existing possessors of
resources and otherwise developed robust systems for recognizing each other’s
entitlements. See James E. Krier, Evolutionary Theory and the Origin of Property
Rights, 95 Cornell L. Rev. 139 (2009); Jeffrey Evans Stake, The Property “Instinct,”
359 Philosophical Transactions of the Royal Society London B 1763 (2004).
6. Tragedy of the anticommons.  The tragedy of the commons has a flip-side.
Just as a resource held in common entails few (if any) rights to exclude others,
an anticommons entails multiple people having rights to veto the exploitation of
a resource. And just as common property can lead to overconsumption of the
resource in question (with the problem of overconsumption worsening as the
number of commoners increases), so an anticommons leads to underconsumption
(with the problem of underconsumption worsening as the number of anticom-
moners increases). The anticommons is a fine thing when the whole idea is to
keep people from using a resource (imagine a wilderness preserve, or a nuclear
waste site), but counterproductive otherwise.
Michael A. Heller, The Tragedy of the Anticommons: Property in the
Transition from Marx to Markets, 111 Harv. L. Rev. 621 (1998), illustrates the
tragedy of the anticommons by discussing Moscow’s empty storefronts in the first
few years after the collapse of communism:

Socialist rule stifled markets and often left store shelves bare. One promise of
the transition “from Marx to markets” was that new entrepreneurs would acquire
the stores, create businesses, and fill the shelves. However, after several years of
reform, storefronts often remained empty, while flimsy metal kiosks, stocked full of
goods, mushroomed up on Moscow streets. Why did new merchants not come in
from the cold? [Id. at 622-623.]

The answer, according to Heller, owes to the way the government was creating
new property rights. Usually, for example, no one person or entity was given own-
ership of a storefront. Instead, the incidents of ownership were broken up and
distributed among a number of competing owners: one person had the right to
sign a lease, another to receive some of the lease revenue, another to sell the
property altogether, another to occupy the premises, and so on. “Each owner,”
says Heller, “can block the others from using the space as a storefront. No one can
set up shop without collecting the consent of all of the other owners.” Id. at 623.16

16. Professor Heller presents an expanded version of his analysis, written for a lay audience, in The
Gridlock Economy: How Too Much Ownership Wrecks Markets, Stops Innovation, and Costs Lives (2008). For
more on the commons and the anticommons, see Stephen R. Munzer, The Commons and the Anticommons in
the Law and Theory of Property, in The Blackwell Guide to the Philosophy of Law and Legal Theory 148 (Martin
P. Golding & William A. Edmundson eds., 2005); Lee Anne Fennell, Common Interest Tragedies, 98 Nw. U. L.
35

Setting up a kiosk, by contrast, was relatively straightforward. An entrepre-


neur just needed to bribe a small number of government officials and the local
Russian mafia, of whom it was said, “they don’t charge too much, they tell you
exactly how much they want up front, and when an agreement is made, they live
up to it.” Id. at 643 (quoting James P. Gallagher, Russia’s Kiosk Capitalists Keep
Wary Eye on Hard-Line Premier, Chi. Trib., Jan. 5, 1993, at 1).
7. The conservation organization Greenpeace tries to frustrate the capture
of whales by interposing its own boats between whalers and their prey. Suppose
conservationists as a group can demonstrate that this is their shared custom, and
they have adopted it because they think it maximizes the aggregate wealth of the
world by preventing excessive whaling. Should the custom count? The case that
follows, though decided more than three centuries ago, bears directly on the
question.

Keeble v. Hickeringill
Queen’s Bench, 1707
11 East 574, 103 Eng. Rep. 1127
11 Mod. 74, 130 (as Keble v. Hickringill)
3 Salk. 9 (as Keeble v. Hickeringhall)

Action upon the case. Plaintiff declares that he was, 8th November in the second
year of the Queen, lawfully possessed of a close of land called Minott’s Meadow,
[containing] a decoy pond, to which divers wildfowl used to resort and come:
and the plaintiff had at his own costs and charges prepared and procured divers
decoy ducks, nets, machines and other engines for the decoying and taking of the
wildfowl, and enjoyed the benefit in taking them: the defendant, knowing which,
and intending to damnify the plaintiff in his vivary, and to fright and drive away
the wildfowl used to resort thither, and deprive him of his profit, did, on the 8th
of November, resort to the head of the said pond and vivary, and did discharge six
guns laden with gunpowder, and with the noise and stink of the gunpowder did
drive away the wildfowl then being in the pond: and on the 11th and 12th days
of November the defendant, with design to damnify the plaintiff, and fright away
the wildfowl, did place himself with a gun near the vivary, and there did discharge
the said gun several times that was then charged with the gunpowder against the
said decoy pond, whereby the wildfowl were frighted away, and did forsake the
said pond. Upon not guilty pleaded, a verdict was found for the plaintiff and 20l.
damages.

Rev. 907 (2004); James M. Buchanan & Yong J. Yoon, Symmetric Tragedies: Commons and Anticommons, 43
J.L. & Econ. 1 (2000).
Yet another variant on common ownership is the “semicommons,” so named because it combines private
and common ownership. In a semicommons, property is private for some purposes and common for others.
On the semicommons, see Henry E. Smith, Semicommon Property Rights and Scattering in the Open Fields,
29 J. Legal Stud. 131 (2000); Zachary C.M. Arnold, Note, Against the Tide: Connecticut Oystering, Hybrid
Property, and the Survival of the Commons, 124 Yale L.J. 1206 (2015). For an overview of all the variations on
common property, see Lee Anne Fennell, Commons, Anticommons, Semicommons, in Research Handbook on
the Economics of Property Law (Kenneth Ayotte & Henry E. Smith eds., 2009); Commons and Anticommons
(Michael A. Heller ed., 2009).
36

Holt, C.J.17 I am of opinion that this action doth lie. It seems to be new in its
instance, but is not new in the reason or principle of it. For, 1st, this using or mak-
ing a decoy is lawful. 2dly, this employment of his ground to that use is profitable
to the plaintiff, as is the skill and management of that employment. As to the first,
every man that hath a property may employ it for his pleasure and profit, as for
alluring and procuring decoy ducks to come to his pond. To learn the trade of
seducing other ducks to come there in order to be taken is not prohibited either
by the law of the land or the moral law; but it is as lawful to use art to seduce them,
to catch them, and destroy them for the use of mankind, as to kill and destroy
wildfowl or tame cattle. Then when a man useth his art or his skill to take them,
to sell and dispose of for his profit; this is his trade; and he that hinders another
in his trade or livelihood is liable to an action for so hindering him. . . .
[W]here a violent or malicious act is done to a man’s occupation, profes-
sion, or way of getting a livelihood, there an action lies in all cases. But if a man
doth him damage by using the same employment; as if Mr. Hickeringill had set
up another decoy on his own ground near the plaintiff’s, and that had spoiled
the custom of the plaintiff, no action would lie, because he had as much liberty
to make and use a decoy as the plaintiff. This is like the case of 11 H. 4, 47.18 One
schoolmaster sets up a new school to the damage of an antient school, and thereby
the scholars are allured from the old school to come to his new. (The action was
held there not to lie.) But suppose Mr. Hickeringill should lie in the way with his
guns, and fright the boys from going to school, and their parents would not let
them go thither; sure that schoolmaster might have an action for the loss of his
scholars. 29 E. 3, 18. A man hath a market, to which he hath toll for horses sold: a
man is bringing his horse to market to sell: a stranger hinders and obstructs him
from going thither to the market: an action lies, because it imports damage. . . .
And when we do know that of long time in the kingdom these artificial con-
trivances of decoy ponds and decoy ducks have been used for enticing into those
ponds wildfowl, in order to be taken for the profit of the owner of the pond, who
is at the expence of servants, engines, and other management, whereby the mar-
kets of the nation may be furnished; there is great reason to give encouragement
thereunto; that the people who are so instrumental by their skill and industry
so to furnish the markets should reap the benefit and have their action. But, in
short, that which is the true reason is that this action is not brought to recover
damage for the loss of the fowl, but for the disturbance; as 2 Cro. 604, Dawney v.
Dee. So is the usual and common way of declaring.

17. Chief Justice Holt was one of the greatest English judges. After the flight of James II to France,
abandoning the throne, Holt, as a member of the House of Commons, played a leading role in establishing a
constitutional monarchy under William and Mary, a system that survives today. Subsequently he was appointed
Chief Justice, which office he held from 1689 to 1710. He was noted for his integrity and independence and for
his common sense as well as his deep learning in the law. Holt laid down the rule that the status of slavery could
not exist in England; as soon as a slave breathed the air of England he was free. Smith v. Brown & Cooper, 2
Salk. 666, 90 Eng. Rep. 1172 (1703). Chief Justice Holt was the first of a line of enlightened judges who, in the
eighteenth century, shaped English law to accommodate the needs of a mercantile society that would dominate
world trading. Lord Mansfield, who served as Chief Justice from 1756 to 1788, was perhaps the most notable of
these. — Eds.
18. The citation indicates a case decided in the eleventh year of the reign of Henry IV (1410). A variant
is Y.B. 11 H.IV, 47. Y.B. refers to one of the Year Books, a collection (running from 1283 to 1535) of anonymous
notes reporting cases. — Eds.
37

NOTES AND QUESTIONS

1. Early English reports.  There were no official reports of judicial decisions in


England prior to the nineteenth century; entrepreneurs gathered up information
about cases in one way or another and published them on their own. Students
of the matter consider some of these unofficial sources to be more reliable than
others. We have not indicated all the reports of Keeble. That from East (reprinted
in Volume 103 of the English Reports), which we have used, is thought to be par-
ticularly trustworthy, the reporter claiming that his account came directly from a
copy of Chief Justice Holt’s manuscript. Modern (Mod.) is not esteemed, nor is
the third volume of Salkeld (Salk.). See generally John W. Wallace, The Reporters
(4th ed. 1882).
2. Keeble and Pierson. Go back to page 21, and you will see that the court in
Pierson v. Post reckoned with Keeble, though it referred to it not by name but only
by citation — the “case cited from 11 Mod. 74-130” and “the report of the same
case, (3 Salk. 9).” The report in 3 Salk. 9 suggested to the court that the result in
Keeble was influenced by the fact that the ducks were in the plaintiff’s decoy pond,
such that the plaintiff had possession of the ducks “ratione soli.” Ratione soli refers
to the conventional view that an owner of land has possession — constructive pos-
session, that is — of wild animals on the owner’s land; in other words, landowners
are regarded as the prior possessors of any animals ferae naturae on their land,
until the animals take off.19
We shall return to ratione soli shortly. The point for now is that it appears
to have had little, if any, bearing on the final decision in Keeble, the statement of
the court in Pierson v. Post to the contrary notwithstanding. The Keeble case was
argued several times, and there was indeed a stage at which Chief Justice Holt
seemed to be of the view that the plaintiff had (constructive) possession of the
ducks in question. The arguments of counsel led him to change his mind, how-
ever, and to rest the judgment on the theory spelled out in the opinion from East
that you have read — the theory of malicious interference with trade.
But the East report was unavailable at the time of Pierson v. Post; it was not
published until 1815, a decade after the decision in Pierson was handed down.
Hence the court had to rely on the accounts in Modern and Salkeld, which, as we
saw, are probably untrustworthy.
3. Spite, Coase, and the common law.  The Keeble case gives rise to a general
question: Should an otherwise privileged act that causes harm to another per-
son be legally actionable if the actor’s motive was to cause harm? The question
involves the doctrine of abuse of right, which provides that an owner abuses her
property right when she exercises that right with the subjective intent of harming
someone. The doctrine is widely recognized in the civil law, but since the decision

19. The word constructive, a modifier familiar to all lawyers, will appear recurrently in this and other
courses. One could say that the word is a way of pretending that whatever word it modifies depicts a state of
affairs that actually exists when actually it does not. The pretense is made whenever judges wish, usually for
good but often undisclosed reasons, a slightly different reality than the one confronting them. One might call
this reasoning by strict analogy: Situation A is magically transformed into Situation B by incantation of the word
constructive. Then the rule governing Situation B is applied to Situation A because the two situations are, after
all, identical! Why might judges wish to pretend that a landowner possesses the wild animals on his land when
actually he does not? See Problem 2 on page 42.
38

in Bradford v. Pickles [1895], A.C. 587, the law in the U.K. and Commonwealth
jurisdictions generally has been thought to indicate that motive is irrelevant. For
a penetrating argument to the contrary, see Larissa Katz, Spite and Extortion: A
Jurisdictional Principle of Abuse of Property Right, 122 Yale L.J. 1444 (2013). See
also the fine book by Michael Taggart, Private Property and the Abuse of Rights in
Victorian England: The Story of Edward Pickles and the Bradford Water Supply
(2002).
Spiteful actions continue to be particularly disfavored in property law when
it comes to construction. Suppose that landowner Alice lives across the street from
her neighbors, Boris and Cooper. Alice has a lovely view of a nearby lake from
her master bedroom deck. She sees the lake by looking over Boris and Cooper’s
respective rooftops. Boris decides to add an additional story to his home so he
can accommodate his growing family comfortably, and as a consequence half of
Alice’s lake view is blocked. Contemporaneously, bad blood develops between
Alice and Cooper. Cooper decides to build a tall trellis on top of his roof. Cooper
doesn’t really gain any tangible benefit from having the trellis there, but Cooper
knows that Alice loved her lake view and relishes Alice’s comeuppance. As a result
of Cooper’s actions, the other half of Alice’s lake view disappears. The law treats
these two situations very differently, giving Alice a cause of action against Cooper
but not against Boris. Why should that be, if the result in both cases is an equiva-
lent obstruction of Alice’s lake view? See Nadav Shoked, Two Hundred Years of
Spite, 110 Nw. U. L. Rev. 357 (2016) (arguing that the costs and benefits of the
respective structures, not the motives of their respective builders, should be deci-
sive). Now suppose that Cooper’s motivations for building the trellis are mixed:
Cooper built the trellis mostly to block Alice’s view, but Cooper also knew that
the trellis would shield his backyard from the glaring afternoon sun. Does the
existence of this fringe benefit change the outcome? See Oblensky v. Trombley,
115 A.3d 1016 (Vt. 2015) (discussing the varied approaches of jurisdictions to this
question, with the states split between a “sole purpose” test and a “predominant
purpose” test for spite fences).
Before we forget about Alice, let us use her story to illustrate one more fun-
damental point about the law. If Alice does not like what has happened to her,
she can try to bargain with Boris and/or Cooper. Suppose that she values her view
much more than Boris values the extra bedrooms he can squeeze into his taller
home. We might expect to see her pay him enough money to keep his house
at its current height. Assuming that it is not too difficult for them to bargain,
whether the law assigns Alice a right to keep her view or Boris a right to build an
extra story should not alter the ultimate outcome, which is that Alice will retain
her lake view. The situation between Alice and Cooper is different. There’s acri-
mony there, and animosity of this sort raises the transaction costs of Alice and
Cooper working out a mutually beneficial deal. (Recall Note 4 on pages 31-33.)
Even though Alice might value her view more than Cooper values his trellis (and
more than he values the harm he is inflicting on Alice!) the two of them find it
too unpleasant to talk and hence too difficult to negotiate with each other. A bar-
gain that would make both of them better off is never struck. See in this regard
the classic essay by Ronald Coase, The Problem of Social Cost, 3 J.L. & Econ. 1
(1960). The essay develops what is now called the Coase Theorem, which holds
39

that in the absence of transaction costs it is irrelevant from the standpoint of effi-
ciency whether Boris is liable to Alice for blocking her view. Resources will be put
to their efficient use in either event, though the rules of property law will have
distributive effects, making Alice and Boris richer or poorer. In 1991, Ronald
Coase was awarded the Nobel Memorial Prize in Economic Science, becoming
the only law professor ever to earn that award. He died in September 2013, just a
few months short of his 103rd birthday.
4. Interference with capture.  Was it essential to the outcome in Keeble that
the plaintiff was engaged in something like a trade, as opposed to mere sport?
Suppose Dahlia is an avid hunter who tracks down a deer on a piece of open
hunting land during the hunting season. The deer is at very close range and just
as Dahlia is about to shoot it another hunter, Eric, appears and does so. Who gets
the deer? Was it essential to the outcome in Keeble that the ducks were frightened
off, rather than captured by a competitor of the plaintiff? Suppose that Eric is not
a hunter but a zealous animal lover who at the last instant frightens the deer away.
Does Dahlia have any recourse?20
The second of the two situations described above gets us back to the activi-
ties of Greenpeace and other conservation groups mentioned in Note 7 on
page 35. An article in the N.Y. Times, Nov. 23, 1990, at A22, reports that inter-
ference with the capture or killing of wild animals has become such a problem
that most states and the federal government have enacted legislation outlawing
hunter harassment on public land. Some challenges to the anti-harassment laws
have succeeded on grounds of unconstitutional vagueness and violation of the
First Amendment’s protection of free speech. See also James E. Krier, Capture
and Counteraction: Self-Help by Environmental Zealots, 30 U. Rich. L. Rev. 103
(1997).
5. The past and the future. Can an early 18th century case like Keeble resolve dis-
tinctly modern disputes? See Thomas E. Simmons, When Robots Trespass, The
Space Review, Jan. 16, 2017 (using Keeble to address legal questions concerning
the mining of asteroids by artificially intelligent robots).

NOTE, PROBLEMS, AND MORE ON THE RULE OF CAPTURE


AND WILD ANIMALS

1. Duck decoys.  Duck decoys, invented in Holland in the sixteenth century


and introduced into England in the seventeenth, provided an efficient system
for capturing wild ducks on a commercial scale. A typical decoy consisted of a
large pool of water from which radiated creeks, called pipes, which were roofed
with netting. Ducks were attracted to the pool by the use of decoys; next, a spe-
cially trained dog, a piper, would appear at the front of a pipe and lure them

20. An illuminating way to begin thinking about both of these questions is this: Try to imagine what
instrumental ends — or objectives or policies — the decisions in Pierson and Keeble might have aimed to serve.
Consider the schoolmaster of the “antient school” discussed in Keeble. A subsequent schoolmaster scares away the
first school’s students. Cause of action. Lures away the first school’s students. No cause of action. Why the differ-
ence in results, especially given that the “antient school” was in each instance first in time? See Harold Demsetz,
Wealth Distribution and the Ownership of Rights, 1 J. Legal Stud. 223, 231-232 (1972).
40
41

closer (ducks, like humans, are curious and aggressive animals). When the ducks
were well into a pipe, a decoy man, previously hidden by a screen, would appear
behind them (but out of sight of the pool) and frighten them farther into the
pipe, where they were trapped. This technique enabled the capture of very large
numbers of ducks, but didn’t work well if there were disturbances — such as guns
going off.
The use of duck decoys in English wetlands died out in the mid-1900s
(although a few are still operated there, as well as in Holland, to capture birds
for banding). The decoy at Minott’s Meadow silted up long ago, but our late
colleague Brian Simpson visited the area and reported that the site of the decoy
can still be identified, though not with absolute precision. Another site, at Pond
Hall, can also be made out. The Pond Hall decoy was owned by Hickeringill.
Professor Simpson gathers from his research that the Minott’s Meadow decoy

Edmund Hickeringill possibly by R.C. Roffe, after J. Jull.


Chronicle/Alamy Stock Photo. Reproduced with permission.
42

was constructed after Hickeringill’s decoy at Pond Hall, and unusually close to it.
This might have provoked Hickeringill, “a very eccentric parson,” to retaliate as
he did. Hickeringill, after all, had been first in time.
For more on duck decoys in general, and Keeble v. Hickeringill in particular,
see A.W. Brian Simpson, Leading Cases in the Common Law (1995), Chapter
3 of which is entitled “The Timeless Principles of the Common Law: Keeble v.
Hickeringill (1700).” The chapter begins: “The contribution of ducks to the com-
mon law system has been limited, but significant; they have concentrated the
minds of lawyers upon fundamental issues of timeless principle.” Id. at 45.
2. A trespasser who captures a wild animal on the land of another might still
have no rights to the animal as against the landowner, even though the landowner
never had actual physical possession or control and even though the trespasser
does. The court might say that the landowner had “constructive” possession of
the animal. See footnote 19 on page 37. Why? See Ray A. Brown, The Law of
Personal Property 17 (Walter B. Raushenbush ed., 3d ed. 1975), suggesting that
the courts reason as they do because a trespasser should not “be allowed to profit
from his wrong.” Notice the explanation gives rise to yet another question: Why
is trespass considered to be “wrong”? More on that later. Suppose that T, a tres-
passer, captures a wild animal on the land of O, a landowner, and carries it off to
her own land where she confines it in a cage. Subsequently, T1 trespasses on T ’s
land and takes away the animal. In a suit by T against T1 for return of the animal,
T1 defends on the ground that T had no rights of ownership in the animal. How
would you respond, and why? Would your response be different if O had gone on
to the land of T and taken the animal back, and T is now suing O for its return?
3. F has established a herd of deer that she keeps for pleasure and an occa-
sional roast of venison. The deer roam about on open government grazing land
during the day, but are sufficiently tame and domesticated that they return to a
large shelter on F ’s land in the evening. (This is referred to as animus revertendi,
or intention to return.) H, a hunter, licensed to hunt deer on the land, shoots
one of F ’s deer one day during the hunting season. F sues H for return of the
carcass. Who prevails? See Brown, supra, at 18. What policies might be served by
holding for F ? For H ?21
On animus revertendi and the origins of domestic animals, see Robert C.
Ellickson, Stone-Age Property in Domestic Animals: An Essay for Jim Krier, 2
Brigham-Kanner Property Rights Conf. J. 1 (2013).
4. P imports two silver gray foxes, a male and a female, from Canada for
breeding purposes on her Mississippi ranch. The natural habitat of the animals is
the north central United States and Canada. The foxes are wild and once having
escaped any captivity have no inclination to return. For this reason, P keeps her

21. As an aside — but a revealing one — suppose that F has a neighbor who also keeps a herd of deer. A
doe belonging to F roams onto the neighbor’s land, takes up with a buck in the neighbor’s herd, is fed by the
neighbor, and eventually bears a fawn sired, presumably, by the neighbor’s buck. Who owns the fawn, and why?
See Carruth v. Easterling, 150 So. 2d 852 (Miss. 1963), and the marvelous essay by Felix Cohen, Dialogue on
Private Property, 9 Rutgers L. Rev. 357, 365-369 (1954). In his article, Cohen claimed that this so-called rule of
increase is universal, observed in all legal cultures. It appears, however, that the English common law made an
exception in the case of cygnets (baby swans), “which were divided equally between the owner of the cock and
the owner of the hen . . . because of the strict monogamy of swan cocks.” Thomas W. Merrill, Accession and
Original Ownership, 1 J. Legal Analysis 459, 465 n.6 (2009).
43

pair securely confined in a floored pen with plank walls five feet high. Despite
these measures, the male gnaws his way out. P sets traps to recapture him, but to
no avail. Some time later the fox is killed by D in a pine thicket 15 miles from P ’s
ranch. D skins the fox and preserves the hide. P, learning of this, sues for return
of the hide. Who should prevail, and why? See Brown, supra, at 18.
5. F, a farmer, is bothered by wild migrating geese on her land and shoots
them in violation of the fish and game laws. The government confiscates the
carcasses, and F sues for their return. The government wins, the court explain-
ing that the government owns wild animals, may regulate their taking, and may
confiscate animals taken in violation of regulations. See State ex rel. Visser v. State
Fish & Game Commn., 437 P.2d 373 (Mont. 1968). So when the geese return the
next year, F sues the government for damage to her cornfield caused by the geese
the government has been said to own. The government wins again, the court
holding that the government does not own wild fowl and is not liable for damage
caused by them. See Sickman v. United States, 184 F.2d 616 (7th Cir. 1950). Can
you square these two holdings? See Douglas v. Seacoast Prods., Inc., 431 U.S. 265,
284 (1977).

NOTES, QUESTIONS, AND PROBLEMS: THE RULE OF


CAPTURE AND OTHER “FUGITIVE” RESOURCES

1. Oil and gas.  Oil and natural gas commonly collect in reservoirs that under-
lie acres of land owned by many different people. The resources have a fugitive
character in that they wander from place to place. Oil or gas once under the land of
A might migrate to space under the land of B as the result of natural circumstances
or because B drops a well and mines a common pool beneath A’s and B’s land.
The oil or gas mined by B may even have been placed in the pool by A (gas and oil
extracted elsewhere are often reinjected for storage or secondary recovery).
When these obviously problematic situations first led to litigation — usually
(but not always) a suit by someone like A to recover the value of gas or oil drawn
away by someone like B — the courts were induced by the fugitive nature of the
resources in question to liken them to wild animals. And because ownership of
wild animals had long been settled in terms of the rule of capture, the courts rea-
soned that ownership of oil and gas should be determined in the same manner.
There was just one problem, which was that capture rules created perverse incen-
tives for landowners. The U.S. Court of Appeals for the Fifth Circuit recently
explained the issue:

Captain Anthony F. Lucas struck oil in the Spindletop salt dome in Texas in
1901. A black oil plume erupted to twice the height of the drilling derrick, and the
well produced a record 800,000 barrels of oil within nine days. Others rushed to
seize a share of the abundance. Wells were drilled as close together as physically
possible; on occasion four wells were drilled beneath one derrick floor. In short
order, there were 440 wells on Spindletop’s 125-acre hill. Another 600 were drilled
around the hill. Within a few years, most of the wells were dry. As Captain Lucas
remarked, the oil was “milked too hard” and “not milked intelligently.”
44

To prevent this “tragedy of the commons,” states have enacted regulations in


the years since Spindletop. . . . Although Spindletop is an extreme example, similar
wasteful overproduction was once common. A cause was the “rule of capture,” the
common law doctrine initially used in hunting disputes to determine ownership of
wild animals unconstrained by property borders. Taught during the first days of law
school, the doctrine says if you catch it first, it is yours. See Pierson v. Post, 3 Cai. R. 175
(N.Y. Sup. Ct. 1805). Courts later applied the doctrine to oil and natural gas, rea-
soning that they too cross property borders as they seep and spill through crevices
underground. See Brown v. Spilman, 155 U.S. 665, 669-670 (1895). In that context,
the rule means a landowner has a property right in oil and gas produced from wells
on the owner’s land, whether or not it migrated from other lands. So, under the
common law, one landowner could drain an entire reservoir through wells on the
landowner’s property, even if the reservoir extended under others’ lands. Naturally,
surrounding owners usually would not sit idly by while valuable resources drained
out from under them; instead, they raced to produce all the oil and gas they could
through their own property, often drilling multiple wells to extract resources as
quickly as possible. Frank Sylvester & Robert W. Malmsheimer, Oil and Gas Spacing
and Forced Pooling Requirements, 40 U. Dayton L. Rev. 47, 49 (2015). At Spindletop
and elsewhere, this drove up production costs, reduced oil and gas market prices,
and unnecessarily decimated the environment.
States intervened, creating often complex regimes to regulate drilling. First,
they created spacing laws, which prevent wells from being drilled too close together.
Then, to protect landowners who, as a result of spacing laws, were no longer able
to drill on smaller tracts of land, they created pooling laws, which allow owners of
adjacent tracts to combine their interests to form drilling units that meet spacing
requirements. Many states also have “forced pooling laws,” which force unwilling
owners to be part of a drilling unit in order to protect their neighbors’ rights to ben-
efit from their mineral rights and to promote states’ interests in preventing waste
and promoting economic activity.

TDX Energy, L.L.C. v. Chesapeake Operating, Inc., 857 F.3d 253, 255-257 (5th
Cir. 2017) (citations and quotation marks omitted).
Go back to the examples involving A and B above and consider the following:
(a) Does A have any remedy at all if B starts draining the pool? See Barnard
v. Monongahela Natural Gas Co., 65 A. 801 (Pa. 1907) (A can go and do likewise).
Compare Union Gas & Oil Co. v. Fyffe, 294 S.W. 176 (Ky. 1927) (suggesting that A
might be able to get an injunction against excessive drilling or nonratable extrac-
tion). Which of these approaches is better, and why?
(b) Suppose B’s well starts on her land but angles down such that it “bot-
toms” underneath land owned by A. Does the rule of capture still apply? See 1
Howard R. Williams & Charles J. Meyers, Oil and Gas Law 55, 59 (1986).
(c) Suppose that A has reinjected gas (it could as well be oil) that moves
under B’s land. B sues to recover damages for the use and occupation of her land
by A’s gas. What result? See Hammonds v. Central Kentucky Natural Gas Co., 75
S.W.2d 204 (Ky. 1934).
The court in the Hammonds case just cited held that A was not liable because,
under the rule of capture, the gas was no longer hers. Because fugitive resources
are to be treated like “wild animals,” when they “escape” or are “restored to their
natural wild and free state, the dominion and individual proprietorship of any
45

person over them is at an end and they resume their status as common property.”
75 S.W.2d at 206.
Hammonds has been criticized and rejected by a number of jurisdictions on
the grounds that the analogy to wild animals is silly, that reinjected gas or oil
hasn’t really “escaped,” and that in any event it is not “returned to its natural
habitat” by reinjection. The Supreme Court of Kentucky eventually overruled
Hammonds. See Texas American Energy Corp. v. Citizens Fidelity Bank & Trust
Co., 736 S.W.2d 25 (Ky. 1987). Unless it causes tangible harm or interferes with
a neighbor’s use of subsurface land, reinjection does not ordinarily give rise to
liability for the use and occupation of parts of a reservoir underlying the land of
neighbors, even though ownership of the reinjected minerals remains intact. See,
e.g., Railroad Commn. of Texas v. Manziel, 361 S.W.2d 560 (Tex. 1962); Chance v.
BP Chemicals, Inc., 670 N.E.2d 985 (Ohio 1996).
There is a reason independent of strained analogies to discard the rule in
Hammonds: It denied society at large the benefits of economical underground stor-
age. (Do you see why?) There are also reasons — again independent of strained
analogies — to discard the rule of capture altogether, yet it still applies to so-called
native, or pre-severed, gas and oil. Should it? For that matter, should the rule of
capture even be applied to wild animals themselves? Are the sorts of legislative
and administrative reforms discussed in TDX Energy, supra, improvements? Or do
they create different kinds of intractable problems?
2. Water. The rule of capture has played a formative role in the case of
another migratory resource — water. Groundwater (water found in underground
aquifers), for example, was governed early on by the English rule of absolute
ownership, which allowed each landowner over an aquifer to withdraw freely
without regard to effects on neighbors.22 “[F]ramed in property language, the
rule was in reality a rule of capture, for a landowner’s pump could induce water
under the land of his neighbor to flow to his well — water that was in theory the
neighbor’s property while it remained in place.” Restatement (Second) of Torts
ch. 41, commentary at 256 (1977). Whoever first captured the water, then, was
really its owner. The so-called English rule survives in just three states, as during
the twentieth century many jurisdictions abandoned the English rule in favor
of the American rule. The American rule of reasonable use is itself a rule of
capture but with the slight addition that wasteful uses of water, if they actually
harmed neighbors, were considered unreasonable and hence unlawful. As with
the English rule, there was no principle of apportionment among overlying users.
Today groundwater extraction is commonly governed by legislative and adminis-
trative programs. See Joseph W. Dellapenna, A Primer on Groundwater Law, 49
Idaho L. Rev. 265 (2013).
In the western states, surface waters and some groundwater are allocated
according to an explicit rule of first in time, called prior appropriation. The
basic principle is that the person who first appropriates (captures) water and puts
it to reasonable and beneficial use has a right superior to later appropriators.
(Obviously, complications can arise. Suppose that A begins efforts to appropriate

22. What sorts of effects? See generally the Note on Lateral and Subjacent Support on page 738.
46

water from a stream — starts building diversion works — before B, but that B fin-


ishes her works and puts the water to beneficial use before A. Who is prior to
whom? What would Pierson v. Post say?) Prior appropriation doctrine developed
as a direct consequence of the scarcity of water in the arid West. Eastern states,
where water is abundant, use one or another variant of riparian rights, the thrust
of which is that each owner of land along a water source (riparian land) has a right
to use the water, subject to the rights of other riparians. At first glance, riparian
rights have no relation to a rule of capture, or first in time, but on a closer look they
do — because the claims of riparians rest on their underlying holdings of riparian
land, and the land itself was originally acquired by first possession. See Richard A.
Epstein, Possession as the Root of Title, 13 Ga. L. Rev. 1221, 1234 (1979).
The extraordinarily low ratio of streams to land in the West made riparian
law a poor means by which to allocate water there; hence prior appropriation.
Neither system is perfect. Riparian rights, for example, take little or no account
of the relative productivity of the land the water services, encourage the devel-
opment of uneconomical “bowling-alley” parcels of land perpendicular to the
banks of a stream, and ration poorly when stream levels are low. Prior appropria-
tion encourages premature development and excessive diversion. It also rations
poorly when supplies dwindle periodically.
3. Water law and Johnson v. M’Intosh. How should the traditional rights of
indigenous populations to use water resources be vindicated? Does the role that
clean water often plays in religious life matter? For an interesting exploration, see
Rhett B. Larson, Water, Worship, and Wisdom: Indigenous Traditional Ecological
Knowledge and the Human Right to Water, 19 ISLA J. Intl. & Comp. L. 43 (2012).
4. Analogies and their consequences. The rule of capture follows directly from
the powerful principle of first in time. The rule was applied early on to wild animals
and then later, by analogy, to other fugitive resources of the sorts we have consid-
ered. Reasoning by analogy from the familiar to the new is a common human ten-
dency and a handy problem-solving technique; it is also standard practice among
lawyers and judges faced with cases of first impression. See generally Edward H.
Levi, An Introduction to Legal Reasoning (1948). Rather than undertaking a gen-
eral inquiry into the matter, we want to focus on the particular analogy drawn in
the materials we have been discussing. What might be the consequences of apply-
ing the rule of capture to wild animals — and then to oil, gas, water, and other
natural resources? And are the common law rules for fugitive resources applicable
to modern disputes over personal property? Consider the following case.

Popov v. Hayashi
Superior Court of California, County of San Francisco, 2002
2002 WL 31833731

McCarthy, J. In 1927, Babe Ruth hit sixty home runs. That record stood for
thirty four years until Roger Maris broke it in 1961 with sixty one home runs.
Mark McGwire hit seventy in 1998. On October 7, 2001, at PacBell Park in San
Francisco, Barry Bonds hit number seventy three. That accomplishment set a
record which, in all probability, will remain unbroken for years into the future.
47

The event was widely anticipated and received a great deal of attention.
The ball that found itself at the receiving end of Mr. Bonds’ bat garnered
some of that attention. Baseball fans in general, and especially people at the
game, understood the importance of the ball. It was worth a great deal of money
and whoever caught it would bask, for a brief period of time, in the reflected
fame of Mr. Bonds.
With that in mind, many people who attended the game came prepared for
the possibility that a record setting ball would be hit in their direction. Among
this group were plaintiff Alex Popov and defendant Patrick Hayashi. They were
unacquainted at the time. Both men brought baseball gloves, which they antici-
pated using if the ball came within their reach.
They, along with a number of others, positioned themselves in the arcade
section of the ballpark. This is a standing room only area located near right field.
It is in this general area that Barry Bonds hits the greatest number of home runs.
The area was crowded with people on October 7, 2001 and access was restricted
to those who held tickets for that section.
Barry Bonds came to bat in the first inning. With nobody on base and a full
count, Bonds swung at a slow knuckleball. He connected. The ball sailed over the
right-field fence and into the arcade. . . .
When the seventy-third home run ball went into the arcade, it landed in
the upper portion of the webbing of a softball glove worn by Alex Popov. While
the glove stopped the trajectory of the ball, it is not at all clear that the ball was
secure. Popov had to reach for the ball and in doing so, may have lost his balance.
Even as the ball was going into his glove, a crowd of people began to engulf
Mr. Popov. He was tackled and thrown to the ground while still in the process of
attempting to complete the catch. Some people intentionally descended on him
for the purpose of taking the ball away, while others were involuntarily forced to
the ground by the momentum of the crowd. . . .
Mr. Hayashi was standing near Mr. Popov when the ball came into the stands.
He, like Mr. Popov, was involuntarily forced to the ground. He committed no
wrongful act. While on the ground he saw the loose ball. He picked it up, rose to
his feet and put it in his pocket. . . .
It is important to point out what the evidence did not and could not show.
Neither the camera nor the percipient witnesses were able to establish whether
Mr. Popov retained control of the ball as he descended into the crowd. Mr.
Popov’s testimony on this question is inconsistent on several important points,
ambiguous on others and, on the whole, unconvincing. We do not know when or
how Mr. Popov lost the ball.
Perhaps the most critical factual finding of all is one that cannot be made.
We will never know if Mr. Popov would have been able to retain control of the ball
had the crowd not interfered with his efforts to do so. Resolution of that question
is the work of a psychic, not a judge.
Plaintiff has pled causes of actions for conversion, trespass to chattel, injunc-
tive relief and constructive trust.
Conversion is the wrongful exercise of dominion over the personal prop-
erty of another. There must be actual interference with the plaintiff’s dominion.
Wrongful withholding of property can constitute actual interference even where
48

the defendant lawfully acquired the property. If a person entitled to possession of


personal property demands its return, the unjustified refusal to give the property
back is conversion.
The act constituting conversion must be intentionally done. There is no
requirement, however, that the defendant know that the property belongs to
another or that the defendant intends to dispossess the true owner of its use and
enjoyment. Wrongful purpose is not a component of conversion. . . .
Trespass to chattel, in contrast, exists where personal property has been
damaged or where the defendant has interfered with the plaintiff’s use of the
property. Actual dispossession is not an element of the tort of trespass to chattel.
In the case at bar, Mr. Popov is not claiming that Mr. Hayashi damaged the
ball or that he interfered with Mr. Popov’s use and enjoyment of the ball. He
claims instead that Mr. Hayashi intentionally took it from him and refused to give
it back. There is no trespass to chattel. If there was a wrong at all, it is conversion.
Conversion does not exist, however, unless the baseball rightfully belongs to
Mr. Popov. One who has neither title nor possession, nor any right to possession,
cannot sue for conversion. The deciding question in this case then, is whether
Mr. Popov achieved possession or the right to possession as he attempted to catch
and hold on to the ball.
The parties have agreed to a starting point for the legal analysis. Prior to the
time the ball was hit, it was possessed and owned by Major League Baseball. At the
time it was hit it became intentionally abandoned property. The first person who
came in possession of the ball became its new owner.
The parties fundamentally disagree about the definition of possession. In
order to assist the court in resolving this disagreement, four distinguished law
professors participated in a forum to discuss the legal definition of possession.23
The professors also disagreed. . . .
The focus of the analysis in this case is not on the thoughts or intent of the
actor. Mr. Popov has clearly evidenced an intent to possess the baseball and has
communicated that intent to the world. The question is whether he did enough
to reduce the ball to his exclusive dominion and control. Were his acts sufficient
to create a legally cognizable interest in the ball?
Mr. Hayashi argues that possession does not occur until the fan has com-
plete control of the ball. Professor Brian Gray suggests the following definition:
“A person who catches a baseball that enters the stands is its owner. A ball is
caught if the person has achieved complete control of the ball at the point in time
that the momentum of the ball and the momentum of the fan while attempting
to catch the ball ceases. A baseball, which is dislodged by incidental contact with
an inanimate object or another person, before momentum has ceased, is not pos-
sessed. Incidental contact with another person is contact that is not intended by
the other person. The first person to pick up a loose ball and secure it becomes
its possessor.” [This definition is hereinafter referred to as Gray’s Rule.]

23. They are Professor Brian E. Gray, University of California, Hastings College of the Law; Professor
Roger Bernhardt, Golden Gate University School of Law; Professor Paul Finkelman, The Chapman Distinguished
Professor of Law, The University of Tulsa School of Law; and Professor Jan Stiglitz, California Western School
of Law. . . .
49

Hayashi and Popov pose with the historic baseball.


©New York Daily News Archive/Getty Images

Mr. Popov argues that this definition requires that a person seeking to estab-
lish possession must show unequivocal dominion and control, a standard rejected
by several leading cases. Pierson v. Post, 3 Cai. R. (N.Y. 1805); Young v. Hitchens
6 Q.B. 606 (1844); State v. Shaw, 67 Ohio St. 157, 65 N.E. 875 (1902). Instead, he
offers the perspectives of Professor Bernhardt and Professor Paul Finkelman who
suggest that possession occurs when an individual intends to take control of a ball
and manifests that intent by stopping the forward momentum of the ball whether
or not complete control is achieved.
Professors Finkelman and Bernhardt have correctly pointed out that
some cases recognize possession even before absolute dominion and control is
achieved. Those cases require the actor to be actively and ably engaged in efforts
to establish complete control. Moreover, such efforts must be significant and they
must be reasonably calculated to result in unequivocal dominion and control at
some point in the near future.
This rule is applied in cases involving the hunting or fishing of wild animals or
the salvage of sunken vessels. The hunting and fishing cases recognize that a mor-
tally wounded animal may run for a distance before falling. The hunter acquires
possession upon the act of wounding the animal not the eventual capture. Similarly,
whalers acquire possession by landing a harpoon, not by subduing the animal.
In the salvage cases, an individual may take possession of a wreck by exerting
as much control “as its nature and situation permit.” Inadequate efforts, however,
will not support a claim of possession. Thus, a “sailor cannot assert a claim merely
by boarding a vessel and publishing a notice, unless such acts are coupled with
a then present intention of conducting salvage operations, and he immediately
thereafter proceeds with activity in the form of constructive steps to aid the dis-
tressed party.” Brady v. S.S. African Queen, 179 F. Supp. 321, 324 (E.D. Va. 1960).
50

These rules are contextual in nature. They are crafted in response to the
unique nature of the conduct they seek to regulate. Moreover, they are influ-
enced by the custom and practice of each industry. The reason that absolute
dominion and control is not required to establish possession in the cases cited
by Mr. Popov is that such a rule would be unworkable and unreasonable. The
“nature and situation” of the property at issue does not immediately lend itself to
unequivocal dominion and control. It is impossible to wrap ones arms around a
whale, a fleeing fox or a sunken ship.
The opposite is true of a baseball hit into the stands of a stadium. Not only
is it physically possible for a person to acquire unequivocal dominion and control
of an abandoned baseball, but fans generally expect a claimant to have accom-
plished as much. The custom and practice of the stands creates a reasonable
expectation that a person will achieve full control of a ball before claiming pos-
session. There is no reason for the legal rule to be inconsistent with that expecta-
tion. Therefore Gray’s Rule is adopted as the definition of possession in this case.
The central tenant of Gray’s Rule is that the actor must retain control of
the ball after incidental contact with people and things. Mr. Popov has not estab-
lished by a preponderance of the evidence that he would have retained control of
the ball after all momentum ceased and after any incidental contact with people
or objects. Consequently, he did not achieve full possession.
That finding, however, does not resolve the case. The reason we do not know
whether Mr. Popov would have retained control of the ball is not because of inci-
dental contact. It is because he was attacked. His efforts to establish possession
were interrupted by the collective assault of a band of wrongdoers. . . .
As a matter of fundamental fairness, Mr. Popov should have had the oppor-
tunity to try to complete his catch unimpeded by unlawful activity. To hold other-
wise would be to allow the result in this case to be dictated by violence. That will
not happen. . . .
Here Mr. Popov seeks, in effect, a declaratory judgment that he has either
possession or the right to possession. In addition he seeks the remedies of injunc-
tive relief and a constructive trust. These are all actions in equity. A court sitting
in equity has the authority to fashion rules and remedies designed to achieve
fundamental fairness.
Consistent with this principle, the court adopts the following rule. Where
an actor undertakes significant but incomplete steps to achieve possession of a
piece of abandoned personal property and the effort is interrupted by the unlaw-
ful acts of others, the actor has a legally cognizable pre-possessory interest in the
property. That pre-possessory interest constitutes a qualified right to possession
which can support a cause of action for conversion. . . .
Mr. Hayashi was not a wrongdoer. He was a victim of the same bandits that
attacked Mr. Popov. The difference is that he was able to extract himself from
their assault and move to the side of the road. It was there that he discovered the
loose ball. When he picked up and put it in his pocket he attained unequivocal
dominion and control.
If Mr. Popov had achieved complete possession before Mr. Hayashi got the
ball, those actions would not have divested Mr. Popov of any rights, nor would
they have created any rights to which Mr. Hayashi could lay claim. Mr. Popov,
51

however, was able to establish only a qualified pre-possessory interest in the ball.
That interest does not establish a full right to possession that is protected from a
subsequent legitimate claim.
On the other hand, while Mr. Hayashi appears on the surface to have done
everything necessary to claim full possession of the ball, the ball itself is encum-
bered by the qualified pre-possessory interest of Mr. Popov. At the time Mr.
Hayashi came into possession of the ball, it had, in effect, a cloud on its title.
An award of the ball to Mr. Popov would be unfair to Mr. Hayashi. It would
be premised on the assumption that Mr. Popov would have caught the ball. That
assumption is not supported by the facts. An award of the ball to Mr. Hayashi would
unfairly penalize Mr. Popov. It would be based on the assumption that Mr. Popov
would have dropped the ball. That conclusion is also unsupported by the facts.
Both men have a superior claim to the ball as against all the world. Each
man has a claim of equal dignity as to the other. We are, therefore, left with some-
thing of a dilemma.
Thankfully, there is a middle ground. . . .
The concept of equitable division has its roots in ancient Roman law. . . . [I]t
is useful in that [the concept of equitable ownership] “provides an equitable way
to resolve competing claims which are equally strong.” Moreover, “[i]t comports
with what one instinctively feels to be fair.” R.H. Helmholz, Equitable Division
and the Law of Finders, 52 Fordham L. Rev. 313, 315 (1983). . . .
Mr. Hayashi’s claim is compromised by Mr. Popov’s pre-possessory interest.
Mr. Popov cannot demonstrate full control. . . . Their legal claims are of equal
quality and they are equally entitled to the ball.
The court therefore declares that both plaintiff and defendant have an equal
and undivided interest in the ball. Plaintiff’s cause of action for conversion is sus-
tained only as to his equal and undivided interest. In order to effectuate this rul-
ing, the ball must be sold and the proceeds divided equally between the parties.

POSTSCRIPT
The ball was initially estimated to be worth as much as $1.5 million, but ended
up selling at auction for $450,000. The shortfall gave rise to another legal
battle. Popov’s attorney obtained a freeze on his client’s half of the money to
help pay a legal bill of $473,530.32. Popov wound up declaring bankruptcy in
2005, with his attorney becoming one of the creditors who litigated to obtain
repayment in bankruptcy. See In re Popov, 2007 WL 1970102 (Bankr. N.D.
Cal. July 3, 2007). He did not fare well in the bankruptcy litigation. See, e.g.,
Kaisha v. Dodson, 423 B.R. 888 (Bankr. N.D. Cal. 2010) (finding that Popov
fraudulently transferred his shares in his restaurant to his spouse, and awarding
those shares to the restaurant’s creditor instead). For much more detail on the
dispute, including a very close analysis of the pertinent video footage, interested
readers should watch Michael Wranovics’s enjoyable 2005 documentary film, Up
for Grabs.
52

NOTES AND QUESTIONS

1. Ballpark injuries. What happened to Mr. Popov is freakishly rare. Fans are
almost never hurt fighting over baseballs that are hit into the stands. But another
kind of fan injury is much more common. According to a recent Bloomberg
News estimate, approximately 1,750 of the 53,000 foul balls hit into the stands at
major league baseball games every year injure spectators. An injury occurs about
two times in every three games. Though most of the injuries are minor bruises or
abrasions, some are life-threatening, and children are more likely than adults to
be seriously wounded. See David Glovin, Baseball Caught Looking as Fouls Injure
1,750 Fans a Year, Bloomberg News, Sept. 9, 2014. Are these risks relevant to the
Popov court’s analysis?
2. Custom yet again.  Recall that in Pierson, the dissent suggested that the dis-
pute between Pierson and Post should have been decided on the basis of the cus-
tom of hunters. Is Popov an appropriate case for decision on the basis of custom?
If custom should be given weight, whose custom should count? For example, the
custom among baseball players is that if the ball is hit to the outfield and one
outfielder signals his intention to catch the ball by calling out or waving his team-
mates away, the other outfielders must defer to him and give him the first chance
to catch the ball. Should that custom apply to and bind the fans in the stands
as well? Even assuming that one small community’s custom is sensible, how are
people outside that community to know what the custom is? See Henry E. Smith,
Community and Custom in Property, 10 Theoretical Inq. L. 5 (2009).
3. Equitable division: half-measures.  The court in Popov reached the Solomonic
solution of dividing the proceeds from the sale of the baseball between Messrs.
Popov and Hayashi. This “equitable division” remedy might be defensible in situa-
tions like Popov, where both parties have made some contribution toward reducing
the object to physical custody. Recall that some whaling customs embraced equi-
table division. See page 30. For instance, whalers around the Galapagos Islands
typically split the value of a sperm whale carcass 50-50 between the first ship to
affix a drogue to the whale and the ultimate taker.24 See Robert C. Ellickson, A
Hypothesis of Wealth-Maximizing Norms: Evidence from the Whaling Industry,
5 J. Law, Econ. & Org. 83, 93 (1989). However, outside of the context of whal-
ing and the examples mentioned in Popov, courts generally eschew half-measure
remedies. Was splitting the value of the ball appropriate in Popov? Would splitting
the fox’s value have been appropriate in Pierson v. Post? In general, should courts
split the value of disputed property more often, or is that just a way of avoiding a
difficult decision?

24. “A drogue was a float, perhaps two feet square, to which the trailing end of a harpoon line was
attached. The drogue was thrown overboard from a whaling boat after the harpoon had been cast into the
whale. This device served both to tire the animal and also to mark its location, thus setting up the final kill.”
Ellickson, supra, at 91.
Chapter 2

Acquisition of Property by
Subsequent Possession: Find,
Adverse Possession, and Gift

Possession, as we saw in the preceding chapter, is a powerful concept in the law of


property. By virtue of first possession one can make an unowned thing, or a thing
before enjoyed only by all in common, one’s own. But suppose the principle of
first in time, so dominant in Chapter 1, no longer holds. Suppose that something
already owned by someone else, say A, subsequently comes into the possession of B,
and without A’s consent. Surprisingly enough, B might still become the thing’s
“owner,” as the first two sections of this chapter make clear. Even without being
declared owner, B might nevertheless be granted considerable protection by the
legal system. But when does B have “possession,” so as to enjoy this favored posi-
tion, and why are possessors favored anyway? These important questions figured
in the last chapter and they do so again in this one.
Another common theme persists. Chapter 1 was concerned, among other
things, with acquisition of property other than by purchase, and this chapter is
as well — right through to its final section, where we examine the law of gifts.
Possession plays a role there, too.

A. Acquisition by Find

Possession is eleven points in the law. — 


Colley Cibber,
Woman’s Wit, Act I (1697)

53
54

Possession is very strong; rather more than nine points of the law. — 
Lord Mansfield,
Corporation of Kingston-upon-Hull v. Horner,
98 Eng. Rep. 807, 815 (1774)
Finders keepers, losers weepers. — 
Old Scottish Proverb

Armory v. Delamirie
King’s Bench, 1722
1 Strange 505

The plaintiff being a chimney sweeper’s boy found a jewel and carried it to the
defendant’s shop (who was a goldsmith)1 to know what it was, and delivered it
into the hands of the apprentice, who under pretence of weighing it, took out the
stones, and calling to the master to let him know it came to three halfpence, the
master offered the boy the money, who refused to take it, and insisted to have the
thing again; whereupon the apprentice delivered him back the socket without
the stones. And now in trover against the master these points were ruled:
1. That the finder of a jewel, though he does not by such finding acquire an
absolute property or ownership, yet he has such a property as will enable him to
keep it against all but the rightful owner, and consequently may maintain trover.
2. That the action well lay against the master, who gives a credit to his appren-
tice, and is answerable for his neglect.
3. As to the value of the jewel several of the trade were examined to prove
what a jewel of the finest water that would fit the socket would be worth; and the
Chief Justice (Pratt) directed the jury, that unless the defendant did produce the
jewel, and shew it not to be of the finest water, they should presume the strongest
against him, and make the value of the best jewels the measure of their damages:
which they accordingly did.

NOTES AND QUESTIONS

1. Based on judicial statements like that in the Armory case, it is often said
“that the title of the finder is good as against the whole world but the true owner. . . .”
Ray A. Brown, The Law of Personal Property 26 (Walter B. Raushenbush ed., 3d ed.

1. Some information about the parties in this famous case: The plaintiff was, as indicated, a chimney
sweeper’s boy named Armory. Chimney sweepers — or sweeps, as we would say today — came into demand in the
seventeenth century, when middle-class people started living in houses with fireplaces in every room. Flues were
made to be small (about 9 by 14 inches), so that several could fit into one chimney. Hence sweeps employed
little boys, sometimes as young as age four, to clean the flues, removing soot with brooms and scrapers as they
worked their way up the tight spaces. The boys wore stovepipe hats to dislodge soot and keep it out of their eyes.
As for the defendant, his surname (de Lamerie, given name Paul) was misspelled by the court reporter. He was
a goldsmith, but made his reputation working in silver. He was the most celebrated and prolific silversmith of
the finest period of English silver work, the first half of the eighteenth century. His work can be seen in many
American museums, and his finest pieces have sold at auction for more than $1 million. — Eds.
55

1975). To test the generalization, suppose that F1 loses a watch he had earlier
found and that it is subsequently found by F2. F1 sues F2 for return of the watch.
Who wins? The answer, as it happens, is that F1 wins. Knowing this, can you revise
the statement from Brown quoted above so that it accurately states the law?
Lawyers conceive of property as referring to relationships among people
with respect to things, not to a relationship between a person and a thing. The
F1-F2 problem provides an illustration of that proposition. The meaning of the
phrase true owner depends upon who the other claimants are. Title, or ownership,
is relative : B can have title as against C but not as against A.
The rule that a prior possessor prevails over a subsequent possessor applies
in cases involving land as well as in cases involving personal property. See Percy
Bordwell, Ejectment Takes Over, 55 Iowa L. Rev. 1089 (1970).
2. In Armory v. Delamirie the plaintiff sued defendant in trover. Trover is a
common law action for money damages resulting from the defendant’s conver-
sion to his own use of a chattel owned or possessed by the plaintiff. The plaintiff
waives his right to obtain the return of the chattel and insists that the defendant
be subjected to a forced purchase of the chattel from him. If the defendant loses,
he must pay money damages to the plaintiff. What is the measure of damages: the
value of the chattel at the time the conversion occurs or the value of the plain-
tiff’s interest (i.e., the value of the chattel discounted by the probability that the
true owner will appear and reclaim it)? Which measure did the court adopt? Is it
sound?
3. Suppose that in 1723 the true owner of the jewel involved in the Armory
case appeared at the goldsmith’s shop and demanded return of the jewel. What
are the rights of the goldsmith and the true owner as against each other and as
against the chimney sweeper’s boy? See the case of The Winkfield, [1902] P. 42
(1901), involving a voluntary bailment,2 where the court said: “The wrongdoer, hav-
ing once paid full damages to the bailee, has an answer to any action by the bailor.”
In voluntary bailment situations, as in The Winkfield, the courts usually bar
an action by the true owner against the present possessor if the bailee has recov-
ered from the present possessor. See Note, Bailment: The Winkfield Doctrine, 34
Cornell L.Q. 615 (1949). Should they bar an action by the true owner against the
present possessor when a finder or prior wrongful possessor has recovered from the
present possessor? Why might this case be treated differently? See Brown, supra,
at § 11.11.

2. A bailment is the rightful possession of goods by a person (the bailee) who is not the owner. A vol-
untary bailment occurs when the owner of the goods (the bailor) gives possession to the bailee, as when you
leave your clothes with a laundry service, check your coat at a restaurant, turn over your car keys to a parking lot
attendant, or deposit mail in the post office. In the case of found goods, the bailment is involuntary from the
standpoint of the owner, but not from that of the finder, who has, after all, chosen to take possession; by doing
so, the finder assumes the obligations of a bailee. What are those obligations? Traditionally, the answer to that
question has turned on an elaborate scheme of classification according to which some bailees were held to a
standard of great care, some (such as finders) to a standard of minimal care, and the balance to an ordinary
negligence standard of reasonable care under the circumstances. The modern view is that the latter standard
should apply across the board. See Richard H. Helmholz, Bailment Theories and the Liability of Bailees: The
Elusive Uniform Standard of Reasonable Care, 41 U. Kan. L. Rev. 97 (1992).
56

4. Would it have made any difference in Armory v. Delamirie if the chimney


sweeper’s boy had taken the jewel off a dressing table in the house where he was
cleaning the chimney? In Anderson v. Gouldberg, 53 N.W. 636 (Minn. 1892), the
plaintiffs trespassed upon the timberland of a third party, cut logs, and hauled them
to a mill, where the defendants took them. In an action of replevin (a lawsuit to
obtain return of the goods, not damages), the court ruled for the plaintiffs and said:

Therefore the only question is whether bare possession of property, though


wrongfully obtained, is sufficient title to enable the party enjoying it to maintain
replevin against a mere stranger, who takes it from him. We had supposed that
this was settled in the affirmative as long ago, at least, as the early case of Armory v.
Delamirie, 1 Strange 505, so often cited on that point.
When it is said that to maintain replevin the plaintiff’s possession must have
been lawful, it means merely that it must have been lawful as against the person who
deprived him of it; and possession is good title against all the world except those
having a better title.
Counsel says that possession only raises a presumption of title, which, however,
may be rebutted. Rightly understood, this is correct; but counsel misapplies it. One
who takes property from the possession of another can only rebut this presumption
by showing a superior title in himself, or in some way connecting himself with one
who has. One who has acquired the possession of property, whether by finding, bail-
ment, or by mere tort, has a right to retain that possession as against a mere wrong-
doer who is a stranger to the property. Any other rule would lead to an endless series
of unlawful seizures and reprisals in every case where property had once passed out
of the possession of the rightful owner. [53 N.W. at 637.]

Richard H. Helmholz, Wrongful Possession of Chattels: Hornbook Law and Case


Law, 80 Nw. U. L. Rev. 1221 (1986), notes that cases like Anderson, involving two
wrongdoers, seldom arise. After surveying a number of substantive areas (includ-
ing the law of finders), Helmholz concludes that in the more common case of dis-
putes between a prior wrongful possessor and an honest subsequent one, courts
regularly prefer the latter — in quiet defiance of the hornbook rule. The rule of
prior possession is said to be explicitly invoked only in support of honest claim-
ants. See also John V. Orth, Russell v. Hill (N.C. 1899): Misunderstood Lessons, 73
N.C. L. Rev. 2031 (1995). Quite to the contrary, however, is a recent case, Payne v.
TK Auto Wholesalers, 911 A.2d 747 (Conn. App. 2006), citing Anderson favorably
and recognizing the possessory interest of a wrongdoer as against all but the true
owner of the property in question.
5. Should the courts be more willing to grant replevin to the prior possessor
than to grant money damages? See Annot., 150 A.L.R. 163 (1944). Should it mat-
ter whether the true owner is known?
Replevin and trover are actions involving personal property. The action
similar to replevin in real property cases3 is an action for possession (ejectment),

3. Real property is that sort of property for which a “real action,” as distinct from a “personal action,”
could be brought in the king’s courts in feudal times. The word real is derived from the Latin res meaning
“thing” and was applied to actions concerning land because, if an owner had been wrongfully deprived of land,
the remedy was restoration of the land (i.e., the thing) itself, whereas in a “personal action” (which was, in early
times, all that could be brought in respect of movable goods), the court would allow payment of the value of
57

and the action similar to trover is an action for damages (trespass).4 The courts
appear to be more reluctant to give the prior possessor of land, who has no title,
permanent damages than to put the prior possessor back into possession.

Hannah v. Peel
King’s Bench Division, 1945
[1945] K.B. 509

Action tried by Birkett, J. On December 13, 1938, the freehold of Gwernhaylod


House, Overton-on-Dee, Shropshire, was conveyed to the defendant, Major Hugh
Edward Ethelston Peel, who from that time to the end of 1940 never himself
occupied the house and it remained unoccupied until October 5, 1939, when it
was requisitioned [for quartering soldiers], but after some months was released
from requisition. Thereafter it remained unoccupied until July 18, 1940, when
it was again requisitioned, the defendant being compensated by a payment at
the rate of 250 l. a year. In August, 1940, the plaintiff, Duncan Hannah, a lance-
corporal, serving in a battery of the Royal Artillery, was stationed at the house and
on the 21st of that month, when in a bedroom, used as a sick-bay, he was adjusting
the black-out curtains when his hand touched something on the top of a window-
frame, loose in a crevice, which he thought was a piece of dirt or plaster. The
plaintiff grasped it and dropped it on the outside window ledge. On the following
morning he saw that it was a brooch covered with cobwebs and dirt. Later, he took
it with him when he went home on leave and his wife having told him it might be
of value, at the end of October, 1940, he informed his commanding officer of his
find and, on his advice, handed it over to the police, receiving a receipt for it. In
August, 1942, the owner not having been found the police handed the brooch to
the defendant, who sold it in October, 1942, for 66l., to Messrs. Spink & Son, Ltd.,
of London, who resold it in the following month for 88l. There was no evidence
that the defendant had any knowledge of the existence of the brooch before it
was found by the plaintiff. The defendant had offered the plaintiff a reward for
the brooch, but the plaintiff refused to accept this and maintained throughout his
right to the possession of the brooch as against all persons other than the owner,
who was unknown. By a letter, dated October 5, 1942, the plaintiff’s solicitors
demanded the return of the brooch from the defendant, but it was not returned
and on October 21, 1943, the plaintiff issued his writ claiming the return of the
brooch, or its value, and damages for its detention. By his defence, the defendant
claimed the brooch on the ground that he was the owner of Gwernhaylod House
and in possession thereof. . . .

the goods instead of compelling their return. After considerable hesitancy, the law finally developed the action
of replevin for the specific return of movable goods, but by this time the name personal property had become
stuck to them.
4. The common law actions of trover, replevin, ejectment, and trespass, which were complicated by
numerous procedural niceties, have in most states been simplified and in many renamed. We leave these
details for your course in Civil Procedure, but note that the essential difference in remedies afforded by these
actions — the return of the thing as opposed to damages — is preserved in modern codes of civil procedure.
58

Birkett, J. There is no issue of fact in this case between the parties. As to the issue
in law, the rival claims of the parties can be stated in this way: The plaintiff says:
“I claim the brooch as its finder and I have a good title against all the world, save
only the true owner.” The defendant says: “My claim is superior to yours in as
much as I am the freeholder. The brooch was found on my property, although I
was never in occupation, and my title, therefore, ousts yours and in the absence
of the true owner I am entitled to the brooch or its value.” Unhappily the law on
this issue is in a very uncertain state and there is need of an authoritative decision
of a higher court. Obviously if it could be said with certainty that this is the law,
that the finder of a lost article, wherever found, has a good title against all the
world save the true owner, then, of course, all my difficulties would be resolved; or
again, if it could be said with equal certainty that this is the law, that the possessor
of land is entitled as against the finder to all chattels found on the land, again my
difficulties would be resolved. But, unfortunately, the authorities give some sup-
port to each of these conflicting propositions. . . .
The case of Bridges v. Hawkesworth, 21 L.J. (Q.B.) 75, 15 Jur. 1079, was . . .
an appeal against a decision of the county court judge at Westminster. The facts
appear to have been that in the year 1847 the plaintiff, who was a commercial
traveller, called on a firm named Byfield & Hawkesworth on business, as he was
in the habit of doing, and as he was leaving the shop he picked up a small parcel
which was lying on the floor. He immediately showed it to the shopman, and
opened it in his presence, when it was found to consist of a quantity of Bank of
England notes, to the amount of 65l. The defendant, who was a partner in the
firm of Byfield & Hawkesworth, was then called, and the plaintiff told him he
had found the notes, and asked the defendant to keep them until the owner
appeared to claim them. Then various advertisements were put in the papers

Gwernhaylod House, Overton-on-Dee


Gwernhaylod, a Welsh word, means sunny marsh. Gwernhaylod House was originally built
in 1460, rebuilt in 1740, and torn down in 1950.
59

asking for the owner, but the true owner was never found. No person having
appeared to claim them, and three years having elapsed since they were found,
the plaintiff applied to the defendant to have the notes returned to him, and
offered to pay the expenses of the advertisements, and to give an indemnity. The
defendant refused to deliver them up to the plaintiff, and an action was brought
in the county court of Westminster in consequence of that refusal. The county
court judge decided that the defendant, the shopkeeper, was entitled to the cus-
tody of the notes as against the plaintiff, and gave judgment for the defendant.
Thereupon the appeal was brought which came before the court composed by
Patteson, J., and Wightman, J. Patteson, J., said: “The notes which are the subject
of this action were incidentally dropped, by mere accident, in the shop of the
defendant, by the owner of them. The facts do not warrant the supposition that
they had been deposited there intentionally, nor has the case been put at all upon
that ground. The plaintiff found them on the floor, they being manifestly lost by
someone. The general right of the finder to any article which has been lost, as
against all the world, except the true owner, was established in the case of Armory
v. Delamirie, 1 Str. 505, which has never been disputed. This right would clearly
have accrued to the plaintiff had the notes been picked up by him outside the
shop of the defendant and if he once had the right, the case finds that he did
not intend, by delivering the notes to the defendant, to waive the title (if any)
which he had to them, but they were handed to the defendant merely for the pur-
pose of delivering them to the owner should he appear.” Then a little later: “The
case, therefore, resolves itself into the single point on which it appears that the
learned judge decided it, namely, whether the circumstance of the notes being
found inside the defendant’s shop gives him, the defendant, the right to have
them as against the plaintiff, who found them.” After discussing the cases, and
the argument, the learned judge said: “If the discovery had never been communi-
cated to the defendant, could the real owner have had any cause of action against
him because they were found in his house? Certainly not. The notes never were
in the custody of the defendant, nor within the protection of his house, before
they were found, as they would have been had they been intentionally deposited
there; and the defendant has come under no responsibility, except from the com-
munication made to him by the plaintiff, the finder, and the steps taken by way of
advertisement. . . . We find, therefore, no circumstances in this case to take it out
of the general rule of law, that the finder of a lost article is entitled to it as against
all persons except the real owner, and we think that that rule must prevail, and
that the learned judge was mistaken in holding that the place in which they were
found makes any legal difference. Our judgment, therefore, is that the plaintiff is
entitled to these notes as against the defendant.”
It is to be observed that in Bridges v. Hawkesworth, which has been the
subject of immense disputation, neither counsel put forward any argument on
the fact that the notes were found in a shop. Counsel for the appellant assumed
throughout that the position was the same as if the parcel had been found in a
private house, and the learned judge spoke of “the protection of his” (the shop-
keeper’s) “house.” The case for the appellant was that the shopkeeper never knew
of the notes. Again, what is curious is that there was no suggestion that the place
where the notes were found was in any way material; indeed, the judge in giving
60

the judgment of the court expressly repudiates this and said in terms “The learned
judge was mistaken in holding that the place in which they were found makes any
legal difference.” It is, therefore, a little remarkable that in South Staffordshire
Water Co. v. Sharman, [1896] 2 Q.B. 44, Lord Russell of Killowen, C.J., said: “The
case of Bridges v. Hawkesworth stands by itself, and on special grounds; and on
those grounds it seems to me that the decision in that case was right. Someone had
accidentally dropped a bundle of banknotes in a public shop. The shopkeeper did
not know they had been dropped, and did not in any sense exercise control over
them. The shop was open to the public, and they were invited to come there.”
That might be a matter of some doubt. Customers were invited there, but whether
the public at large was, might be open to some question. Lord Russell continued:
“A customer picked up the notes and gave them to the shopkeeper in order that
he might advertise them. The owner of the notes was not found, and the finder
then sought to recover them from the shopkeeper. It was held that he was entitled
to do so, the ground of the decision being, as was pointed out by Patteson, J., that
the notes, being dropped in the public part of the shop, were never in the custody
of the shopkeeper, or ‘within the protection of his house.’” Patteson, J., never
made any reference to the public part of the shop and, indeed, went out of his
way to say that the learned county court judge was wrong in holding that the place
where they were found made any legal difference. . . .
With regard to South Staffordshire Water Co. v. Sharman, [1896] 2 Q.B.
44, the first two lines of the headnote are: “The possessor of land is generally
entitled, as against the finder, to chattels found on the land.” I am not sure that
this is accurate. The facts were that the defendant Sharman, while cleaning out,
under the orders of the plaintiffs, the South Staffordshire Water Company, a pool
of water on their land, found two rings embedded in the mud at the bottom of
the pool. He declined to deliver them to the plaintiffs, but failed to discover the
real owner. In an action brought by the company against Sharman in detinue it
was held that the company was entitled to the rings. Lord Russell of Killowen,
C.J., said: “The plaintiffs are the freeholders of the locus in quo, and as such they
have the right to forbid anybody coming on their land or in any way interfering
with it. They had the right to say that their pool should be cleaned out in any way
that they thought fit, and to direct what should be done with anything found in
the pool in the course of such cleaning out. It is no doubt right, as the counsel
for the defendant contended, to say that the plaintiffs must show that they had
actual control over the locus in quo and the things in it; but under the circum-
stances, can it be said that the Minster Pool and whatever might be in that pool
were not under the control of the plaintiffs? In my opinion they were. . . . The
principle on which this case must be decided, and the distinction which must be
drawn between this case and that of Bridges v. Hawkesworth, is to be found in a
passage in Pollock and Wright’s essay on Possession in the Common Law, p. 41:
‘The possession of land carries with it in general, by our law, possession of every-
thing which is attached to or under that land, and, in the absence of a better title
elsewhere, the right to possess it also. . . .’” And it makes no difference that the
possessor is not aware of the thing’s existence. . . .
Then Lord Russell cited the passage which I read earlier in this judgment
and continued: “It is somewhat strange” — I venture to echo those words — “that
61

there is no more direct authority on the question; but the general principle
seems to me to be that where a person has possession of house or land, with a
manifest intention to exercise control over it and the things which may be upon
or in it, then, if something is found on that land, whether by an employee of the
owner or by a stranger, the presumption is that the possession of that thing is
in the owner of the locus in quo.” It is to be observed that Lord Russell there is
extending the meaning of the passage he had cited from Pollock and Wright’s
essay on Possession in the Common Law, where the learned authors say that the
possession of “land carries with it possession of everything which is attached to or
under that land.” Then Lord Russell adds possession of everything which may be
on or in that land. South Staffordshire Water Co. v. Sharman, which was relied
on by counsel for the defendant, has also been the subject of some discussion. It
has been said that it establishes that if a man finds a thing as the servant or agent
of another, he finds it not for himself, but for that other, and indeed that seems
to afford a sufficient explanation of the case. The rings found at the bottom of
the pool were not in the possession of the company, but it seems that though
Sharman was the first to obtain possession of them, he obtained them for his
employers and could claim no title for himself.
The only other case to which I need refer is Elwes v. Brigg Gas Co., 33 Ch. D.
562, in which land had been demised to a gas company for ninety-nine years with a
reservation to the lessor of all mines and minerals. A pre-historic boat embedded in
the soil was discovered by the lessees when they were digging to make a gasholder. It
was held that the boat, whether regarded as a mineral or as part of the soil in which
it was embedded when discovered, or as a chattel, did not pass to the lessees by the
demise, but was the property of the lessor though he was ignorant of its existence
at the time of granting the lease. Chitty, J., said: “The first question which does
actually arise in this case is whether the boat belonged to the plaintiff at the time
of the granting of the lease. I hold that it did, whether it ought to be regarded as a
mineral, or as part of the soil within the maxim above cited, or as a chattel. If it was
a mineral or part of the soil in the sense above indicated, then it clearly belonged
to the owners of the inheritance as part of the inheritance itself. But if it ought to
be regarded as a chattel, I hold the property in the chattel was vested in the plain-
tiff, for the following reasons.” Then he gave the reasons, and continued: “The
plaintiff then being thus in possession of the chattel, it follows that the property in
the chattel was vested in him. Obviously the right of the original owner could not
be established; it had for centuries been lost or barred, even supposing that the
property had not been abandoned when the boat was first left on the spot where it
was found. The plaintiff, then, had a lawful possession, good against all the world,
and therefore the property in the boat. In my opinion it makes no difference, in
these circumstances, that the plaintiff was not aware of the existence of the boat.”5

5. “Thus the case ended,” says a comment on Elwes written a century later. “Mr. Elwes, having gained pos-
session of the boat, exhibited it in a specially constructed brick building in the estate yard, near Brigg Station.
There for twenty-three years many thousands of visitors paid for admission to see it.” Subsequently Elwes gave
the boat to a public museum at Hull. “[I]t was carefully removed to Hull, via the River Ancholme (appropriately
enough), though in a rather different method from the trip it made on the same river some two thousand
or more years ago. Would that it had remained in Brigg! In 1943 the boat was destroyed in an air raid on the
museum premises. . . .” Michael L. Nash, Are Finders Keepers? One Hundred Years Since Elwes v. Brigg Gas Co.,
137 New L.J. 118, 119 (1987). — Eds.
62

A review of these judgments shows that the authorities are in an unsatisfac-


tory state. . . .
It is fairly clear from the authorities that a man possesses everything which
is attached to or under his land. Secondly, it would appear to be the law from
the authorities I have cited, and particularly from Bridges v. Hawkesworth, that a
man does not necessarily possess a thing which is lying unattached on the surface
of his land even though the thing is not possessed by someone else. A difficulty,
however, arises . . . because the rule which governs things an occupier possesses
as against those which he does not, has never been very clearly formulated in our
law. . . .
There is no doubt that in this case the brooch was lost in the ordinary mean-
ing of that term, and I should imagine it had been lost for a very considerable
time. Indeed, from this correspondence it appears that at one time the prede-
cessors in title of the defendant were considering making some claim. But the
moment the plaintiff discovered that the brooch might be of some value, he took
the advice of his commanding officer and handed it to the police. His conduct
was commendable and meritorious. The defendant was never physically in pos-
session of these premises at any time. It is clear that the brooch was never his, in
the ordinary acceptation of the term, in that he had the prior possession. He had
no knowledge of it, until it was brought to his notice by the finder. A discussion of
the merits does not seem to help, but it is clear on the facts that the brooch was
“lost” in the ordinary meaning of that word, that it was “found” by the plaintiff
in the ordinary meaning of that word, that its true owner has never been found,
that the defendant was the owner of the premises and had his notice drawn to this
matter by the plaintiff, who found the brooch. In those circumstances I propose
to follow the decision in Bridges v. Hawkesworth, and to give judgment in this
case for the plaintiff for 66l.
Judgment for plaintiff.

NOTES AND QUESTIONS

1. Did Major Peel lose because he did not have prior possession, or did he
not have prior possession because he lost?
2. How effective was the court’s marshalling of precedent to support its
decision? Was its reasoning persuasive? Was the court relying upon horse sense?
Do the words of the court act as a guide for the prediction of the outcome of
similar, but not too similar, cases?
3. Suppose Major Peel had resided in Gwernhaylod House from December
1938 until the first requisition in October 1939. Would the result in Hannah v.
Peel be the same? See Parker v. British Airways Bd., [1982] 2 W.L.R. 503, 516-517:
“I would be inclined to say that the occupier of a house will almost invariably pos-
sess any lost article on the premises. He may not have taken any positive steps to
demonstrate his animus possidendi, but so firm is his control that the animus can
be seen to attach to it” (per Eveleigh, L.J.). Cf. Margaret J. Radin, Property and
Personhood, 34 Stan. L. Rev. 957, 987, 991-996 (1982) (sanctity of the home);
Stephanie M. Stern, Residential Protectionism and the Legal Mythology of Home,
63

107 Mich. L. Rev. 1093 (2009) (drawing on studies in psychology, sociology, and
demography to argue that very little evidence supports the notion that people
regard their homes as special objects).
Or suppose (as was the fact) that the house had never been occupied by
Peel but also never requisitioned by the government. Hannah, while stationed at
a nearby military base, went for a walk in the woods around Gwernhaylod House,
was intrigued by the imposing mansion, entered by the unlocked front door,
and found the brooch. Would the result in Hannah v. Peel be the same? Recall
Problem 2 on page 42, and see Favorite v. Miller, 407 A.2d 974, 977 (Conn. 1978)
(owner of locus prevails as against trespassing finder unless trespass “trivial or
merely technical”); Bishop v. Ellsworth, 234 N.E.2d 49, 52 (Ill. App. 1968) (“if
the discoverer is a trespasser such trespasser can have no claim to possession of
such property even if it might otherwise be considered lost”). But see Hendle v.
Stevens, 586 N.E.2d 826, 832 (Ill. App. 1992) (“we think the Bishop court’s state-
ment that a trespasser has no claim to possession of lost property is erroneous”).

McAvoy v. Medina
Supreme Judicial Court of Massachusetts, 1866
93 Mass. (11 Allen) 548

Tort to recover a sum of money found by the plaintiff in the shop of the defendant.
At the trial in the superior court, before Morton, J., it appeared that the
defendant was a barber, and the plaintiff, being a customer in the defendant’s
shop, saw and took up a pocket-book which was lying upon a table there, and
said, “See what I have found.” The defendant came to the table and asked where
he found it. The plaintiff laid it back in the same place and said, “I found it right
there.” The defendant then took it and counted the money, and the plaintiff told
him to keep it, and if the owner should come to give it to him; and otherwise to
advertise it; which the defendant promised to do. Subsequently the plaintiff made
three demands for the money, and the defendant never claimed to hold the same
till the last demand. It was agreed that the pocket-book was placed upon the table
by a transient customer of the defendant and accidentally left there, and was first
seen and taken up by the plaintiff, and that the owner had not been found.
The judge ruled that the plaintiff could not maintain his action, and a
verdict was accordingly returned for the defendant; and the plaintiff alleged
exceptions. . . .

Dewey, J. It seems to be the settled law that the finder of lost property has a valid
claim to the same against all the world except the true owner, and generally that
the place in which it is found creates no exception to this rule. 2 Parsons on Con.
97; Bridges v. Hawkesworth, 7 Eng. Law & Eq. R. 424.
But this property is not, under the circumstances, to be treated as lost prop-
erty in that sense in which a finder has a valid claim to hold the same until called
for by the true owner. This property was voluntarily placed upon a table in the
defendant’s shop by a customer of his who accidentally left the same there and
has never called for it. The plaintiff also came there as a customer, and first saw
64

the same and took it up from the table. The plaintiff did not by this acquire the
right to take the property from the shop, but it was rather the duty of the defen-
dant, when the fact became thus known to him, to use reasonable care for the
safe keeping of the same until the owner should call for it. In the case of Bridges
v. Hawkesworth the property, although found in a shop, was found on the floor
of the same, and had not been placed there voluntarily by the owner, and the
court held that the finder was entitled to the possession of the same, except as to
the owner. But the present case more resembles that of Lawrence v. The State, 1
Humph. (Tenn.) 228, and is indeed very similar in its facts. The court there take a
distinction between the case of property thus placed by the owner and neglected
to be removed, and property lost. It was there held that “to place a pocket-book
upon a table and to forget to take it away is not to lose it, in the sense in which the
authorities referred to speak of lost property.”
We accept this as the better rule, and especially as one better adapted to
secure the rights of the true owner.
In view of the facts of this case, the plaintiff acquired no original right to
the property, and the defendant’s subsequent acts in receiving and holding the
property in the manner he did does not create any.
Exceptions overruled.

NOTES AND QUESTIONS

1. The rule in McAvoy.  An essay by Walter Wheeler Cook, Ownership and


Possession, in 11 Encyclopedia of the Social Sciences 521, 524 (1935), says this:
“It is obvious . . . that from the point of view of social policy the shopkeeper ought
to be preferred to the customer, as in that event the article would be more likely
to get back into the possession of the real owner.” Do you agree? Are you sure?
2. Mislaid, lost, and abandoned property.  A typical summary of the common
law rules on finders runs like this: “A finder of property acquires no rights in mis-
laid property, is entitled to possession of lost property against everyone except the
true owner, and is entitled to keep abandoned property.” Michael v. First Chicago
Corp., 487 N.E.2d 403, 409 (Ill. App. 1985).
Like many typical summaries, this one is a bit misleading. The statement
regarding mislaid property is correct, but the statement regarding lost prop-
erty is not — at least in some jurisdictions. Notice, for example, that the state-
ment neglects the distinctions, suggested in Hannah v. Peel, having to do with
the circumstances under which lost goods are found: Embedded in the soil, or
not? Found in a public place, or a private one? Such considerations can matter.
Should they?
The statement is also probably inaccurate as to abandoned property, mean-
ing items intentionally and voluntarily relinquished, with no intent to reclaim.
The dominant concern of the law of finders — to protect true owners — drops
out in the case of abandoned property, because the true owner has renounced
any claim, but the interests of the owner of the place of the find remain. Should
they count?
65

©Michael Maslin/Condé Nast Publications/www.cartoonbank.com

Was the wallet lost, or mislaid?

3. Employees and other agents.  A janitor cleaning up in a hotel finds a sum of


money and turns it in to the manager. After a year the money is unclaimed, and
the janitor sues for its return. Who wins? The law here sprawls all over the lot,
with decisions commonly turning on the lost-mislaid-abandoned distinction, or
on the place of the find, or on the law of principal and agent. See, e.g., Jackson v.
Steinberg, 200 P.2d 376 (Or. 1948), reh’g denied, 205 P.2d 562 (Or. 1949) ($800
found by chambermaid under paper lining in dresser drawer awarded to hotel
owner on theory that it was mislaid property that the maid had a duty to deliver to
her employer); Erickson v. Sinykin, 26 N.W.2d 172 (Minn. 1947) (money found
by interior decorator held abandoned, and decorator, unlike a maid or janitor,
had no duty to report find to employer); Kalyvakis v. The T.S.S. Olympia, 181 F.
Supp. 32 (S.D.N.Y. 1960) ($3,000 found by ship steward on floor of ship’s public
men’s room awarded to finder on ground that it was lost or abandoned; court
rejected English master-servant (principal-agent) exception as not in accord with
the weight of American authority).
What about finds by police officers? They commonly come across money in
the course of their duties, and sometimes they (or their supervisors) want to keep
it. A 1995 Oklahoma case arose when the Hoel family saw money scattered along
a road as they drove home from dinner. Mrs. Hoel contacted authorities, while
Mr. Hoel and one of his sons secured the scene. A little while later a deputy sher-
iff arrived and took possession of the money, $4,600 in hundred dollar bills. The
66

Hoels told him they wanted the money if its rightful owner were not located. A
half year later, the sheriff’s office started an action seeking permission to deposit
the money in the Sheriff’s Training Fund, arguing that the Hoels had never taken
possession of it. The court held for the Hoels. They hadn’t taken literal posses-
sion of the money, but only because the deputy had ordered them not to touch
it. They had taken charge of the scene before the deputy arrived, and that was
enough to give them the rights of a finder — rights superior to anyone (even a
sheriff!) but the true owner of the funds. See Hoel v. Powell, 904 P.2d 153 (Okla.
App. 1995).
See also Pennsylvania v. $7,000 in U.S. Currency, 742 A.2d 711 (Pa. Commw.
1999), and In re Funds in the Possession of Conemaugh Township, 724 A.2d 990
(Pa. Commw. 1999).
4. Treasure trove.  At English common law treasure trove (derived from the
Old French tresor trové, found treasure) belonged to the king. Treasure trove was
any money or coin, gold, silver plate, or bullion hidden in the earth. When the
Romans were driven out of England and northern Europe, they concealed their
money and treasures underground, and the kings or conquering generals, know-
ing this, seized the goods for themselves and punished severely any person who
did not deliver up found treasures. The law drew a distinction between treasures
hidden with the intention of returning to reclaim them, which went to the king,
and abandoned property, which went to the finder. Nowadays, it appears, the
practice of the British Crown is to give treasure trove to British museums, pro-
vided they agree to make a payment of half the value to the finder. According to
a 2010 report on the BBC News, an amateur treasure hunter in Scotland found
gold ornaments after exploring with his new metal detector and digging a hole
when alerted by it. The trove, four neck ornaments over two thousand years old,
had a value of about £1 million, half of which had to be paid to the finder (who
said he would give a share to the landowner).
Under American law, treasure trove has been treated in various ways over the
years. Nowadays it is usually taken to include any hidden money, gold, and silver,
whether or not buried underground, and the tendency is to treat it like any other
found property (meaning it might be classified as lost or mislaid or abandoned).
See, e.g., Corliss v. Wenner, 34 P.3d 1100 (Idaho App. 2001), refusing to recog-
nize the doctrine of treasure trove and noting that this is the trend among state
and federal courts. Corliss is discussed in Richard B. Cunningham, The Twilight
of Treasure Trove, in Legal Perspectives on Cultural Resources 37 (Jennifer R.
Richman & Marion P. Forsyth eds., 2004). In any event, the finders might end
up weepers rather than keepers. Consider the story of two laborers building a
driveway on Sun Valley, Idaho property belonging to Jann Wenner, the owner
of Rolling Stone. In the course of their work, the two men found four pounds of
gold coins that had been buried in a jar. Much like the finders of money in a
crashed plane in the 1998 movie, A Simple Plan, the two men schemed to keep
the coins secret for a time and then share them, but the plan fell apart and the
men fell out. After several years of litigation, a judge decided that Wenner had
the right to the coins, estimated to be worth about $25,000. The judge rejected
the law of treasure trove, considering it unsuited for modern times. He thought
that because the two finders were working for Wenner, they were acting on his
67

“The way I see it, we divvy up — a third for you, a third for me, and a third for
Sam — and what the George A. Fuller Company don’t know won’t hurt them.”
Robert J. Day/The New Yorker Collection/The Cartoon Bank.

behalf. The coins, like the dirt the men were excavating to build the driveway,
belonged to Wenner as the owner of the land. See Tad Friend, The Gold Diggers,
The New Yorker, May 3, 1999, at 80.
For three recent cases involving the categorical finders’ rules considered in
all the foregoing discussion, see Benjamin v. Lindner Aviation, Inc., 534 N.W.2d
400 (Iowa 1995), In re Seizure of $82,000 More or Less, 119 F. Supp. 2d 1013
(W.D. Mo. 2000), and Terry v. Lock Hospitality, 37 S.W.2d 202 (Ark. 2001). In
Benjamin, $18,000 was found in the wing of an old airplane by an inspector
removing rusty screws. Obviously, the money had not been “lost.” The court
deemed it to be mislaid property, possessed by the owner of the airplane. It had
not been concealed long enough to be a treasure trove, and was not abandoned
because no one would abandon so much money (not even a thief or a drug
68

dealer?). Benjamin was distinguished by the court in the In re Seizure case, not-
withstanding similar facts — money found in the gas tank of a car. The important
difference was that the car had been seized by the government because it had
been used to transport drug proceeds, and then sold (without discovery of the
stash) to a buyer who subsequently noticed a fuel problem. A mechanic hired
to fix the problem found the cash and informed the Drug Enforcement Agency,
which claimed the money as against the buyer of the car. The court held for the
buyer on the ground that the money had been abandoned, not mislaid; the cul-
prits who hid it in the gas tank couldn’t claim it without risking arrest for drug
dealing, so they chose to leave it behind. Thus abandoned, it belonged to the
buyer as the first person to find it (the mechanic was merely the buyer’s agent).
Terry involved a box of money, $38,000 in old currency hidden above the ceiling,
which was discovered by contractors working on a motel. Possession of the find
was awarded to the motel owner — for exactly the reasons set out in Benjamin, on
which the court relied.
5. Shipwrecks.  Under English common law, “wreck” — which referred
very narrowly to cargo washed ashore from a ship lost at sea with no survi-
vors — went to the crown. Blackstone claimed that this right in the king was
“grounded on the consideration of his guarding and protecting the seas from
pirates and robbers.” 1 William Blackstone, Commentaries *290. Under tradi-
tional maritime law, a ship lost at sea and settled on the ocean floor remained
the owner’s property — unless title to the vessel had been abandoned — but
anyone subsequently reducing the ship or its cargo to possession was entitled
to a salvage award. See Columbus-America Discovery Group v. Atlantic Mutual
Ins. Co., 974 F.2d 450 (4th Cir. 1992) (holding that the insurers of the Central
America, which had sunk in 1857, had not abandoned their title and were still
owners of $1 billion in gold on board; the salvors who had found the ship were
entitled to a salvage award).
In this country, the law of finders has usually been applied to ships lost in
territorial waters, and the finder held entitled to an abandoned shipwreck unless
the wreck was embedded in land owned or possessed by another. Given this, the
United States and individual states have successfully asserted claims to shipwrecks
embedded in their territorial waters and thus constructively possessed. In the
Abandoned Shipwreck Act of 1987, 43 U.S.C.A. §§ 2101-2106, the United States
asserts title to any abandoned shipwreck embedded in submerged lands of a state
and simultaneously transfers its title to the state in which the wreck is located.
The purpose is to turn over management of embedded shipwrecks in state waters
to the states and permit them to develop their own rules for salvage or preserva-
tion unimpeded by the general law. (The act provides that the law of finds and
the law of salvage shall not apply to abandoned shipwrecks covered by its provi-
sions.) For criticism of the act, see Forrest Booth, Who Owns Sunken Treasure?
The Supreme Court, the Abandoned Shipwreck Act, and the Brother Jonathan,
11 U.S.F. Mar. L.J. 77 (1998-1999).
Maritime law and its principle of salvage awards, mentioned above, contrasts
sharply with property law, which awards a finder all or nothing, subject to the rights
of the true owner. Should the law of finders be changed so that the finder is entitled
to an award (a reward) if the property in question is returned to its owner or held to
69

be in possession of the owner of the locus?6 Or should the law be changed so that in
hard cases, when no clear policy objective seems to dominate, the value of the find
should be split between the finder and the owner of the locus?7
6. Legislation.  Many states have legislation covering lost, mislaid, and aban-
doned property — sometimes very lengthy and complicated legislation. A typical
statute might require finders to deposit the property at a designated place, pro-
vide for notice to possible owners, and provide for an award of title — say to the
finder — if the property owner does not appear within a specified period. Some
statutes apply only to “lost property.” These statutes have often been construed
narrowly to apply only to “lost” property as defined by common law, and not to
abolish the common law distinctions between types of found property.
7. Items from the news.  An article by Norimitsu Onishi, Never Lost, But Found
Daily: Japanese Honesty, N.Y. Times, Jan. 8, 2004, at A1, reports on the extraordi-
nary tendency of Japanese citizens to take found items into one of many lost-and-
found centers spread throughout Japan. Even cash is commonly turned in — $23
million in 2002, for example. For a comparative study of the Japanese system, see
Mark D. West, Losers: Recovering Lost Property in Japan and the United States, 37
Law & Socy. Rev. 369 (2003), who attributes much of the system’s success to four
factors: the uniformity and simplicity of Japanese finders’ law, as compared to that
in the United States; the fact that the system has been in place for a long time and
thus is familiar to citizens; the many conveniently located lost-and-found centers;
and the sticks and carrots of Japanese law (finders who take possession of lost goods
but do not turn them in are subject to criminal penalties, owners who claim objects
are required to pay a finder’s fee ranging from 5 to 20 percent of the objects’ value,
and if no one claims an object within a specified period, the finder gets it).
Some of the features of the Japanese system can be found in some parts
of the United States, and U.S. finders might be pretty honest in any event. See,

6. There is no common law right to a reward, though statutes in some states may confer such a right.
Moreover, finders and custodians may claim any reward that the owner of the goods has offered, as well as
reimbursement for reasonable expenses incurred in securing and caring for the property in question — this as
a consequence of the law of bailments. See footnote 2 on page 55.
The right to a reward seems to be more common among civil law jurisdictions in Europe (civil law here
meaning codified law that derives from the Roman law tradition). An example is Article 971 of the German
Civil Code:
(1) The finder may demand a finder’s fee from the person entitled to receive the thing. The
finder’s fee amounts to five per cent of the value of the thing up to one thousand Deutsch marks, three
per cent of the value above this figure, and in the case of animals three per cent. If the thing represents
value only to the person entitled to receive it, the finder’s fee shall be fixed in an equitable manner.
(2) The claim is not allowed if the finder violates the duty of reporting or hides the found prop-
erty when inquiry is made.

7. Another kind of division — between custody and eventual ownership — is also possible: “[W]here the
article is found in a quasi-public place, the occupier will be allowed to hold it, but he must relinquish it to the
finder if the owner remains unascertained after a reasonable time.” David Riesman, Jr., Possession and the Law
of Finders, 52 Harv. L. Rev. 1105, 1125 (1939) (a classic essay well worth reading in its entirety).
What do you think of Riesman’s suggestion? What is it supposed to accomplish? Can you imagine how
the concept of possession underlying the common law of finders probably led the courts to neglect various
sorts of division (in time or value or both) in favor of the all-or-nothing approach that characterizes the law of
finders?
For an example of a decision recognizing the important but regularly overlooked distinction between
custody of the found item for now and ownership of the found item eventually, see Paset v. Old Orchard Bank &
Trust Co., 378 N.E.2d 1264 (Ill. App. 1978) (making locus owner temporary custodian and then vesting owner-
ship in finder).
70

e.g., Marc Santora, Teeth Missing? Try Lost and Found, N.Y. Times, Aug. 2, 2002,
at B1, reporting on the lost and found operation at Grand Central Terminal in
Manhattan, and expressing some surprise that so many lost items get turned in,
even though the finders can claim no reward, nor do they get unclaimed goods,
which go to charity. Or consider a letter to the editor by Greg Smithsimon, pub-
lished in the N.Y. Times, Mar. 25, 2007. Students in Smithsimon’s urban stud-
ies course at Barnard College conducted an experiment; they dropped wallets
all over New York City to see if finders returned them; “in 132 drops from the
Bronx to Brooklyn, the wallet was stolen only two times.” And the two that weren’t
returned? They had been “taken during drops made on the tony Upper East Side,
from blocks where median family income is $126,000 per year. Perhaps what goes
around doesn’t come around.”

B. Acquisition by Adverse Possession

This section continues the inquiry begun in the last, on finders. Something is
owned by A; subsequently, and without A’s consent, it comes into the possession
of B. B might become the thing’s owner; short of that, B still has some rights. But,
again, when is B in “possession,” and why is B’s possession — which might be openly
adverse to the claims of A — even recognized by the legal system? These are exactly
the questions considered in the last section, examined now in a new setting.

1. The Theory and Elements of Adverse Possession

Powell on Real Property § 91.01


(Michael A. Wolf gen. ed., 2009)

Every American jurisdiction has one or more statutes of limitations that fix the
period of time beyond which the owner of land can no longer bring an action, or
undertake self-help, for the recovery of land from another person in possession.
These statutes of limitations differ substantially in the duration of the established
periods, in provisions for extending the normally operative period, and in other
particulars. These statutes are complemented and amplified by a large body of case
law that elaborates on the kind of possession by another that is sufficient to cause the
statutory period to begin to run, and to continue running, against the true owner.
Thus, the law of adverse possession is a synthesis of statutory and decisional law.
Statutes of limitations have a long history in Anglo-American law, extend-
ing back beyond the thirteenth century. In a 1275 statute, the practice began of
naming past events, beyond which no suitor in an action affecting land could
search and retrieve evidence supporting title. This permitted recent seisin, even
if tortiously acquired, to become protected ownership. As time passed, and as the
71

historical events named in the statute receded into antiquity, this kind of statute
lost its usefulness. A statute of 1540 adopted the more modern procedure of
stipulating a period of years within which various actions had to be commenced
by the real property owner. This type of statute reached its culmination in a 1623
version, which furnished the pattern for many American enactments.8 . . .
Adverse possession functions as a method of transferring interests in land
without the consent of the prior owner, and even in spite of the dissent of such
owners. It rests upon social judgments that there should be a restricted duration
for the assertion of “aging claims,” and that the passage of a reasonable time
period should assure security to a person claiming to be an owner. The theory
upon which adverse possession rests is that the adverse possessor may acquire
title at such time as an action in ejectment (or other action for possession of real
property) by the record owner would be barred by the statute of limitations.

Henry W. Ballantine,  
Title by Adverse Possession
32 Harv. L. Rev. 135 (1918)

Title by adverse possession sounds, at first blush, like title by theft or robbery, a
primitive method of acquiring land without paying for it. When the novice is told
that by the weight of authority not even good faith is a requisite, the doctrine
apparently affords an anomalous instance of maturing a wrong into a right con-
trary to one of the most fundamental axioms of the law.

For true it is, that neither fraud nor might


Can make a title where there wanteth right.9

The policy of statutes of limitation is something not always clearly appreci-


ated. Dean Ames, in contrasting prescription in the civil law with adverse posses-
sion in our law, remarks: “English lawyers regard not the merit of the possessor,
but the demerit of the one out of possession.” It has been suggested, on the other
hand, that the policy is to reward those using the land in a way beneficial to the
community. This takes too much account of the individual case. The statute has
not for its object to reward the diligent trespasser for his wrong nor yet to penal-
ize the negligent and dormant owner for sleeping upon his rights; the great pur-
pose is automatically to quiet all titles which are openly and consistently asserted,
to provide proof of meritorious titles, and correct errors in conveyancing.

8. 21 Jac. I, Ch. 16, §§ 1, 2 (1623): “For quieting of men’s estates and avoiding of suits [described types
of action] shall be sued and taken within twenty years next after the title and cause of action first descended or
fallen, and at no time after the said twenty years; . . . and that no person or persons shall at any time hereafter
make any entry into any lands, tenements or hereditaments, but within twenty years next after his or their right
of title which shall hereafter first descend or accrue to the same, and in default thereof, such persons, so not
entering and their heirs, shall be utterly excluded and disabled from such entry after to be made. . . .”
9. Quoted in Altham’s Case, 8 Coke Rep. 153, 77 Engl. reprint, 707.
72

Oliver Wendell Holmes,


The Path of the Law
10 Harv. L. Rev. 457, 476-477 (1897)

Let me now give an example to show the practical importance, for the decision of
actual cases, of understanding the reasons of the law, by taking an example from
rules which, so far as I know, never have been explained or theorized about in
any adequate way. I refer to statutes of limitation and the law of prescription. The
end of such rules is obvious, but what is the justification for depriving a man of his
rights, a pure evil as far as it goes, in consequence of the lapse of time? Sometimes
the loss of evidence is referred to, but that is a secondary matter. Sometimes the
desirability of peace, but why is peace more desirable after twenty years than
before? It is increasingly likely to come without the aid of legislation. Sometimes
it is said that, if a man neglects to enforce his rights, he cannot complain if, after
a while, the law follows his example. . . .
I should suggest that the foundation of the acquisition of rights by lapse of time
is to be looked for in the position of the person who gains them, not in that of the
loser. Sir Henry Maine has made it fashionable to connect the archaic notion of prop-
erty with prescription. But the connection is further back than the first recorded his-
tory. It is in the nature of man’s mind. A thing which you have enjoyed and used as
your own for a long time, whether property or an opinion, takes root in your being
and cannot be torn away without your resenting the act and trying to defend your-
self, however you came by it. The law can ask no better justification than the deepest
instincts of man. It is only by way of reply to the suggestion that you are disappoint-
ing the former owner, that you refer to his neglect having allowed the gradual dis-
sociation between himself and what he claims, and the gradual association of it with
another. If he knows that another is doing acts which on their face show that he is
on the way toward establishing such an association, I should argue that in justice to
that other he was bound at his peril to find out whether the other was acting under
his permission, to see that he was warned, and, if necessary, stopped.

NOTES AND QUESTIONS

1. What do you make of the passage from Oliver Wendell Holmes (written a
few years before he joined the U.S. Supreme Court)? Does it suggest that adverse
possession is motivated by economic concerns, or psychological ones, or moral
ones? As it happens, each view finds some support. See, e.g., Richard A. Posner,
Economic Analysis of Law 97-98 (8th ed. 2011) (Holmes was suggesting an eco-
nomic explanation, based on diminishing marginal utility of income); Robert
C. Ellickson, Bringing Culture and Human Frailty to Rational Actors: A Critique
of Classical Law and Economics, 65 Chi.-Kent L. Rev. 23, 39 (1989) (Holmes “is
more faithfully interpreted as anticipating (in a primitive way)” much later devel-
opments in cognitive psychology — in particular, prospect theory, which holds in
part that people regard loss of an asset in hand as more significant than forgo-
ing the opportunity to realize an apparently equivalent gain); Jeffrey E. Stake,
73

The Uneasy Case for Adverse Possession, 89 Geo. L.J. 2419 (2001) (expanding
on Ellickson); Joseph W. Singer, The Reliance Interest in Property, 40 Stan. L.
Rev. 611, 667 (1988) (“The possessor has come to expect continued access to the
property and the true owner has fed those expectations by her actions (or her
failure to act). It is morally wrong for the true owner to allow a relationship of
dependence to be established and then to cut off the dependent party,” citing the
passage from Holmes.).
2. The excerpt from Powell that began this section says that adverse posses-
sion functions as a means of “transferring” ownership, and so it does, but not so
straightforwardly as you might think. The running of the statute of limitations
not only bars an action by the erstwhile owner but also vests a new title, created by
operation of law, in the adverse possessor. Once acquired, this new title “relates
back” to the date of the event that started the statute of limitations running, and
the law acts as though the adverse possessor were the owner from that date. With
what implications? Consider the rule of increase, introduced in footnote 21 on
page 42. By the rule of increase, the offspring of animals belong to the owner of
the mother. Suppose that at point 1 in time A takes possession of B’s cow without
B’s consent; that at point 2 in time a calf is born to the cow; and that at point 3
in time A gets title to the cow by adverse possession. A’s title relates back to point
1 in time. Given that it is now as though A owned the cow since that time, A owns
the calf too, even though A might not have possessed the calf for the statutory
period. (Notice that adverse possession applies to personal property as well as
land — sometimes, however, with special twists that we will take up later.)
3. How (if at all) might one reconcile adverse possession with the principle of
first in time that figured so prominently in Chapter 1? See Richard A. Epstein, Past
and Future: The Temporal Dimension in the Law of Property, in Symposium, Time,
Property Rights, and the Common Law, 64 Wash. U. L.Q. 667, 673, 676 (1986).
Lay people in particular tend to take a dim view of adverse possession doc-
trine, regarding it as a variety of rip-off. In this connection, consider the views
expressed in a recent book by Eduardo M. Peñalver & Sonia K. Katyal, Property
Outlaws 150-156 (2010). The authors aim to rehabilitate the reviled character of
the intentional property lawbreaker by showing how such outlaws have enabled
the reevaluation of (and sometimes changes in) the distribution and content of
property rights. They figure that their views with respect to adverse possession,
understood as a mechanism for redistribution, probably have the most bearing
on less developed areas of the globe, as opposed to countries like the United
States. But, they wonder, is this so even after the great economic downturn?
Even in rich countries and in good times, doesn’t adverse possession make
sense? Suppose (you think) you own a house, but in fact way back in your chain of
title lurks a person who got the property by adversely possessing it — maybe by inad-
vertence, maybe knowingly. Without the doctrine, where would you stand? And on
the knowing adverse possessor, see the discussion in footnote 19 on page 87.
4. Regarding the length of the statute of limitations for adverse possession,
20 years used to be common, but the modern trend is to shorten this to something
on the order of 6 to 10 years (although one can find periods as short as 3 years
and as long as 30 years). See William G. Ackerman & Shane T. Johnson, Outlaws
of the Past: A Western Perspective on Prescription and Adverse Possession, 31
74

Land & Water L. Rev. 79, 111-112 (1996). What considerations should influ-
ence the matter of selecting a statutory period? See Robert C. Ellickson, Adverse
Possession and Perpetuities Law: Two Dents in the Libertarian Model of Property
Rights, in Symposium, supra, at 723, 725-734 (discussing the interests of landown-
ers, adverse possessors, buyers of land, and society at large).

As noted in the Powell excerpt, “the law of adverse possession is a synthesis


of statutory and decisional law,” with judicial rules supplementing the statutes of
limitation that make up the core of adverse possession. The essence of these sup-
plemental rules is this: Adverse possession requires that there be (1) an entry that
is actual and exclusive, (2) open and notorious, (3) continuous for the statutory
period, and (4) adverse and under a claim of right. What might be the substance
and purpose of each of these requirements? The answer to the question is pretty
straightforward, at least for our present introductory purposes, and at least as to
all but the fourth item. Consider:
(1) One obvious reason that an entry is required is that adverse possession
depends on a statute of limitations running against a cause of action, and the
entry (without permission, adverse to the rights of the property owner, but more
on this when we get to the fourth item) creates that cause of action — for tres-
pass — and thereby triggers the statute. Entry also helps stake out what it is the
adverse possessor might end up claiming. Some case law and academic commen-
tary suggest that an actual entry is required because it shows an interloper who at
least is working the property, making it productive, and by these means earning
some rights. (This earning principle is mentioned, with skepticism, in the excerpt
by Ballantine on page 71, and it will come up from time to time later.)
Notice that an adverse possessor’s entry must be exclusive. The idea here is
that if the owner or members of the public generally are using the land along
with the adverse possessor, that tends to indicate that the possession is not adverse
at all, because the adverse possessor is taking no steps to exclude others. That
inference is weaker, however, if the owner or members of the public make only
very occasional or incidental use of the land in question.
(2) Entry must be by acts sufficiently open and notorious that they would put
reasonably attentive property owners on notice that someone is on their ­property.10

10. Notoriety is usually straightforward, but not always. Consider an instance where adverse possession
goes underground. Suppose that A and B are neighbors whose parcels of land lie over a cave, the entrance to
which is on A’s land. A discovers the entrance, explores the full domain of the cave, and then opens it up to the
public for a fee. A’s business, well-known to B, runs for many years. After the statute of limitations has expired,
B learns that part of the cave is under his land and brings suit to quiet his title to that part; A in turn claims title
to all the cave by adverse possession. Was A’s possession open and notorious? No, according to Marengo Cave
Co. v. Ross, 10 N.E.2d 917 (Ind. 1937).
It is implicit in Marengo that the owner of a surface parcel also owns the part of a common cave underly-
ing the parcel. This follows from the so-called ad coelum doctrine: Cujus est solum, ejus est usque ad coelum et ad
infernos (to whomsoever the soil belongs, he owns also to the sky and to the depths). Would it make more sense
to say that the owner of the land on which sits the entrance to a cave owns the cave? To say that whoever discov-
ers a cave and opens it to access owns the cave? To say that all the overlying landowners own the cave together,
in common? Given ad coelum and the three alternatives, which is best? For contending views on that question,
see the majority, concurring, and dissenting opinions in Edwards v. Sims, 24 S.W.2d 619 (Ky. 1929), and Edwards
v. Lee’s Admr., 96 S.W.2d 1028 (Ky. 1936).
75

This requirement reflects the sleeping principle underlying adverse possession; see
Ballantine again, mentioning a purpose “to penalize the negligent and dormant
owner for sleeping upon his rights.” If the adverse possessor’s entry were not rea-
sonably observable, we couldn’t rightly blame an owner for being “dormant.”
(Understand that the notoriety requirement is aimed at constructive not actual
notice; the test of notoriety is objective. If the adverse possessor’s acts would be
noticed by an ordinary person, then the owner is regarded as knowing what should
have been known. But suppose the adverse possessor is a sneak whose acts are not
apparent at all, but happen to be known by the property owner. Does the owner’s
actual notice matter? Does the principle of earning have a bearing on this question?)
(3) Entry must be continuous for the statutory period, but not literally constant.
An adverse possessor is permitted to come and go in the ordinary course, given the
nature of the property in question (being on the farm most of the time; using the
summer fishing camp for regular summer fishing trips; etc.). Note that the continu-
ity requirement reflects, harmoniously, both the earning and sleeping principles.11
In the leading case of Ewing v. Burnet, 36 U.S. (11 Pet.) 41 (1837), adverse
possession of an unimproved lot in Cincinnati, used principally for digging sand
and gravel, was established when the claimant paid taxes on the lot,12 from time to
time dug sand and gravel from it, permitted others to do so, and brought actions
of trespass against others for doing so without his permission. Notice then that
adverse possession may exist even if the occupant does not reside on the property
and for long periods does not use it at all. A commonly stated generalization that
follows from cases like Ewing is this: The sort of entry and possession that will
ripen into title by adverse possession is use of the property in the manner that an
average true owner would use it under the circumstances, such that neighbors
and other observers would regard the occupant as a person exercising exclusive
dominion. But generalizations are dangerous. In Pettis v. Lozier, 349 N.W.2d 372
(Neb. 1984), adverse possession of an eight-acre suburban wooded tract was not
established notwithstanding that the claimant occasionally used the land for a
variety of purposes throughout the statutory period — kept geese and livestock
there, put up three large packing crates to serve as sheds for his animals, planted
native grass and 25 pine trees (all the trees died), did some vegetable gardening,
built a watering tank, set out a beehive, dumped trash and junk and old cars, did
some fencing, used the property for recreation, posted “No Hunting” and “No

Although ad coelum is sometimes taken seriously in the case of caves, the doctrine has little place in mod-
ern times. Think of airplanes; think of carbon sequestration. For a thorough overview, see John G. Sprankling,
Owning the Center of the Earth, 55 UCLA L. Rev. 979 (2008).
11. Distinguish the adverse possessor’s occasional absence from the property, on the one hand, and
abandonment on the other. If the adverse possessor abandons the property — leaves with no intention to
return — before the statute has run, the statute stops, a new entry is required, and the whole process must
begin anew. Distinguish also interruption by the true owner before the statute has run — say by bringing a suc-
cessful ejectment action against the adverse possessor, or by re-entering the property. In the case of a successful
ejectment action, the lawsuit interrupts the period of possession even if the owner does not thereafter actually
oust the adverse possessor, who must start all over. See, e.g., Irving Pulp & Paper Ltd. v. Kelly, 654 A.2d 416
(Me. 1995). As to re-entry by the true owner, it must be open and hostile and effective. See 3 American Law of
Property § 15.9 (1952).
12. A number of states require that adverse possessors pay property taxes in order to have the statute
of limitations running in their behalf. The requirement can help owners of large or remote parcels to moni-
tor whether there might be interlopers occupying their land. Tax payments are a matter of public record, easy
enough to check periodically.
76

Trespassing” signs, twice removed “For Sale” signs, and once told a prospective
purchaser of the tract that it belonged to him.
(4) Turn finally to the requirement that entry must be adverse and under a
claim of right — or, as it is sometimes expressed, hostile and under a claim of title.13
Here the law reflects much contention and confusion, the latter probably caused
in part by the fact that “adversity” and “hostility” imply possessors wrongfully seek-
ing something not theirs, whereas “claim of right” and “claim of title” imply pos-
sessors thinking something is theirs. In any event, there are different points of
view on what the requirement should entail.
Begin with a rather notorious case on the subject. If you read it carefully, you
will see that the majority decision cannot possibly mean what it says.

Van Valkenburgh v. Lutz


Court of Appeals of New York, 1952
106 N.E.2d 28

[Some background information taken by the editors from the record and briefs submitted
to the New York Court of Appeals. Shortly after their marriage in 1912, Mary and
William Lutz bought at auction two wooded lots in Yonkers, a suburb of New
York, taking title in the husband’s name. The lots, numbered 14 and 15, were
situated high on a hill above Leroy Avenue, at the time an unimproved “paper”
street. To the west was a wooded triangular tract — consisting of lots 19, 20, 21,
and 22 — the ownership of which is at issue in this case. (Lots 19-22 appear as
one lot — lot 19 — on the current Yonkers tax map reproduced as Figure 2-1.)
Instead of climbing the steep grade from Leroy Avenue to reach lots 14 and 15,
the Lutzes found it easier to cross the triangular tract which they did not own;
Lutz cleared a “traveled way” near the northern boundary of the tract to reach
Gibson Place on the west.
With the help of his brother Charlie and his wife Mary, William Lutz cleared
lots 14 and 15 and built a house for his family on them. The Lutzes also partially
cleared the triangular tract and built for Charlie a one-room structure on lot 19.
By 1920 the buildings were occupied. In 1921 Mary’s fifth and last child was born
to her in the main house.
In 1928 the city graded Leroy Avenue and broke the private water line lead-
ing to the main Lutz house. Lutz, who was working in New York City at the time,
went home to repair it. As a result, he lost his job; thereafter Lutz stayed home
tending a garden on the triangular property, selling vegetables, and doing odd
jobs for neighbors. The Lutz children grew up, and all except the youngest son,
Eugene, moved away.
In 1937 Joseph and Marion Van Valkenburgh bought lots west of Gibson
Place and built a new home there. Some nine years later, in 1946, bad blood
developed between the Lutzes and the Van Valkenburghs. In April of that year

13. “Claim of title” must not be confused with the concept of “color of title,” considered in the Note on
page 88 and the Problems that follow it.
77

Figure 2-1
Yonkers Tax Map, 1984
(For more images, consult Google Maps, Leroy Ave., Yonkers.)

Mary Lutz was annoyed by the presence of the Van Valkenburgh children in her
garden, and she called her husband over. The Van Valkenburgh children ran
home, Lutz behind them brandishing an iron pipe and crying, “I’ll kill you.” Van
Valkenburgh then appeared and began a heated argument with Lutz. He subse-
quently swore out a complaint of criminal assault, and Lutz was arrested, jailed,
then released on bail.
A year later, in April 1947, the Van Valkenburghs bought lots 19, 20, 21, and
22 from the City of Yonkers at a foreclosure sale for nonpayment of taxes.14 On
the following July 6, Van Valkenburgh, accompanied by two policemen, visited
the triangular tract and, in his words, “took possession” of it. He called to Mrs.

14. Although the laws regarding tax foreclosure sales vary from state to state, usually the purchaser at the
sale (such as the Van Valkenburghs) receives title to the property free and clear of any claims by other parties
(including possessors like the Lutzes), provided appropriate notice was given. Yet, oddly, the Van Valkenburghs
never raised this point in their lawsuit, perhaps because notice had not been given to the Lutzes.
78

Lutz to come out of her house and told her that the Lutzes were to clear from the
property all buildings that belonged to them. On July 8 the Van Valkenburghs’
attorney sent Lutz a registered letter informing him that the triangular tract was
now owned by the Van Valkenburghs and that he should remove any of his prop-
erty from the land. A few days later Lutz went to see the attorney and told him he
wanted proof of the Van Valkenburghs’ ownership and time to harvest his veg-
etable crop. Then, on July 13, Lutz failed to appear for the trial on the charge of
criminal assault, for which he had been arrested a year earlier. A bench warrant
was issued, and Lutz was again arrested, jailed, and released on bail. Subsequently
he was convicted of criminal assault.
In the meantime Van Valkenburgh had the property surveyed. In response
to another letter from the Van Valkenburghs’ attorney, Lutz returned to the
attorney’s office on July 21, this time accompanied by his own lawyer. At this
meeting Lutz agreed to remove his sheds, junk, and garden within thirty days,
but he claimed a prescriptive right15 to use the traveled way to reach his prop-
erty. Lutz then removed the chicken coops and junk. Shortly thereafter the Van
Valkenburghs invited legal action by erecting a fence across the traveled way that
Lutz claimed a right to use. Lutz joined battle by bringing an action against the
Van Valkenburghs to enjoin them from interfering with his right of way. In the
suit Lutz alleged that Marion Van Valkenburgh was the owner of the property, but
that Lutz had a right of way over it. In January 1948 the trial court handed down
a judgment in Lutz’s favor, awarding him a right of way over the traveled way;
this judgment was affirmed by the Appellate Division in June 1948 (Lutz v. Van
Valkenburgh, 81 N.Y.S.2d 161).
The action in this case was commenced against the Lutzes on April 8, 1948.
Perhaps realizing the blunder made in the prior lawsuit (the admission that
Marion Van Valkenburgh owned lots 19-22), Lutz fired his Yonkers lawyer and
hired one from Wall Street. Not to be outdone, the Van Valkenburghs also sought
out and employed a Wall Street firm. In August 1948 William Lutz died, devising
all his property to his wife Mary. The Van Valkenburghs’ suit was tried in June
1950. The testimony in the case totaled some 250 pages, and in addition there
were 56 exhibits consisting of deeds, surveys, and photographs. Several neighbors
who had lived in the area a long time testified for the Lutzes. Not one testified for
the Van Valkenburghs, who lost in the trial court and appealed.]

Dye, J. These consolidated actions were brought to compel the removal of certain
encroachments upon plaintiffs’ lands, for delivery of possession and incidental
relief. The subject property consists of four unimproved building lots designated
as 19, 20, 21 and 22 in block 54 on the official tax map of the city of Yonkers, N.Y.
These lots together form a parcel somewhat triangular in shape with dimensions
of approximately 150 by 126 by 170 feet fronting on Gibson Place, a street to be
laid out within the subdivision running in a northwesterly direction from Leroy

15. Prescription differs from adverse possession in terms of the sorts of interests acquired. By adverse
possession one may acquire the title or ownership, and the exclusive possession, of land formerly belonging to
someone else, say X, whereas prescription gives rise to rights of use, such as rights of way and other easements,
but title to the land remains in X. In some jurisdictions the elements of the two doctrines are essentially identi-
cal, in others not, as we shall see in Chapter 11.
79

Avenue and now surfaced for automobile travel as far as lots 26, 27 and 28. The
subject premises were purchased by the plaintiffs from the city of Yonkers by deed
dated April 14, 1947. At that time the defendants were, and had been since 1912,
owners of premises designated as lots 14 and 15 in block 54, as shown on the
same map. The defendants’ lots front on Leroy Avenue and adjoin lot 19 owned
by the plaintiffs at the rear boundary line. All of these lots, though differently
numbered, appear on a map of the subdivision of the Murray Estate opened prior
to 1912 and numbering 479 lots. At that time that part of the Murray subdivision
was covered with a natural wild growth of brush and small trees.
The defendants interposed an answer denying generally the allegations of
the complaint and alleging as an affirmative defense, and as a counterclaim, that
William Lutz had acquired title to the subject premises by virtue of having held
and possessed the same adversely to plaintiffs and predecessors for upwards of
thirty years.
The issue thus joined was tried before Hon. Frederick P. Close, Official
Referee, who found that title to said lots “was perfected in William Lutz by virtue
of adverse possession by the year 1935” and not thereafter disseized. The judg-
ment entered thereon in favor of the defendants was affirmed in the Appellate
Division, Second Department, without opinion, one Justice dissenting on the
ground that the evidence was insufficient to establish title by adverse possession.
To acquire title to real property by adverse possession not founded upon a
written instrument, it must be shown by clear and convincing proof that for at
least fifteen years (formerly twenty years) there was an “actual” occupation under
a claim of title, for it is only the premises so actually occupied “and no others” that
are deemed to have been held adversely (Civ. Prac. Act, §§ 34, 38, 39). The essen-
tial elements of proof being either that the premises (1) are protected by a sub-
stantial inclosure, or are (2) usually cultivated or improved (Civ. Prac. Act, § 40).16

16. At the time of the Lutz case, N.Y. Civil Practice Act §§ 34, 38, 39, and 40 provided:
§ 34. An action to recover real property or the possession thereof cannot be maintained by a party
other than the people, unless the plaintiff, his ancestor, predecessor or grantor, was seized or possessed
of the premises in question within fifteen years before the commencement of the action. . . .
§ 38. For the purpose of constituting an adverse possession, by a person claiming a title founded
upon a written instrument or a judgment or decree, land is deemed to have been possessed and occupied
in either of the following cases:
1. Where it has been usually cultivated or improved.
2. Where it has been protected by a substantial inclosure.
3. Where, although not inclosed, it has been used for the supply of fuel or of fencing timber,
either for the purposes of husbandry or for the ordinary use of the occupant.
Where a known farm or single lot has been partly improved, the portion of the farm or lot that
has been left not cleared or not inclosed, according to the usual course and custom of the adjoin-
ing country, is deemed to have been occupied for the same length of time as the part improved and
cultivated.
§ 39. Where there has been an actual continued occupation of premises under a claim of title,
exclusive of any other right, but not founded upon a written instrument or a judgment or decree, the
premises so actually occupied, and no others, are deemed to have been held adversely.
§ 40. For the purpose of constituting an adverse possession by a person claiming title not founded
upon a written instrument or a judgment or decree, land is deemed to have been possessed and occupied
in either of the following cases, and no others:
1. Where it has been protected by a substantial inclosure.
2. Where it has been usually cultivated or improved.
These provisions were subsequently revised, among other ways, by reducing the statutory period from 15 to 10
years. — Eds.
80

Concededly, there is no proof here that the subject premises were “protected
by a substantial inclosure” which leaves for consideration only whether there is
evidence showing that the premises were cultivated or improved sufficiently to
satisfy the statute.
We think not. The proof concededly fails to show that the cultivation inci-
dent to the garden utilized the whole of the premises claimed. Such lack may
not be supplied by inference on the showing that the cultivation of a smaller
area, whose boundaries are neither defined nor its location fixed with certainty,
“must have been . . . substantial” as several neighbors were “supplied . . . with veg-
etables.” This introduces an element of speculation and surmise which may not
be considered since the statute clearly limits the premises adversely held to those
“actually” occupied “and no others” (Civ. Prac. Act, §39) which we have recently
interpreted as requiring definition by clear and positive proof (St. William’s
Church v. People, 296 N.Y. 861, revg. 269 App. Div. 874, motion for reargument
denied 296 N.Y. 1000).
Furthermore, on this record, the proof fails to show that the premises were
improved (Civ. Prac. Act, §40). According to the proof the small shed or shack
(about 5 by 10½ feet) which, as shown by survey map, was located on the subject
premises about 14 feet from the Lutz boundary line, . . . was built in about the
year 1923 and, as Lutz himself testified, he knew at the time it was not on his land,
and his wife, a defendant here, also testified to the same effect.
The statute requires as an essential element of proof, recognized as funda-
mental on the concept of adversity since ancient times, that the occupation of
premises be “under a claim of title” (Civ. Prac. Act, §39), in other words, hostile
(Belotti v. Bickhardt, 228 N.Y. 296), and when lacking will not operate to bar the
legal title (Doherty v. Matsell, 119 N.Y. 646), no matter how long the occupation
may have continued (La Frombois v. Jackson, 8 Cow. 589; Colvin v. Burnet, 17
Wend. 564).
Similarly, the garage encroachment, extending a few inches over the bound-
ary line, fails to supply proof of occupation by improvement. Lutz himself testi-
fied that when he built the garage he had no survey and thought he was getting
it on his own property, which certainly falls short of establishing that he did it
under a claim of title hostile to the true owner. The other acts committed by Lutz
over the years, such as placing a portable chicken coop on the premises which
he moved about, the cutting of brush and some of the trees, and the littering of
the property with odds and ends of salvaged building materials, cast-off items of
house furnishings and parts of automobiles which the defendants and their wit-
nesses described as “personal belongings,” “junk,” “rubbish” and “debris,” were
acts which under no stretch of the imagination could be deemed an occupation
by improvement within the meaning of the statute, and which, of course, are of
no avail in establishing adverse possession.
We are also persuaded that the defendant’s subsequent words and con-
duct confirm the view that his occupation was not “under a claim of title.” When
the defendant had the opportunity to declare his hostility and assert his rights
against the true owner, he voluntarily chose to concede that the plaintiffs’ legal
title conferred actual ownership entitling them to the possession of these and
other premises in order to provide a basis for establishing defendant’s right to
81

an easement by adverse possession — the use of a well-defined “traveled way” that


crossed the said premises. In that action (Lutz v. Van Valkenburgh, 274 App. Div.
813), William Lutz, a defendant here (now deceased), chose to litigate the issue
of title and possession and, having succeeded in establishing his claim of ease-
ment by adverse possession, he may not now disavow the effect of his favorable
judgment (Goebel v. Iffla, 111 N.Y. 170), or prevent its use as evidence to show
his prior intent. Declarations against interest made by a prescriptive tenant are
always available on the issue of his intent (6 Wigmore on Evidence, § 1778).
On this record we do not reach the question of disseisin by oral disclaimer,
since the proof fails to establish actual occupation for such time or in such man-
ner as to establish title. What we are saying is that the proof fails to establish actual
occupation for such a time or in such a manner as to establish title by adverse
possession (Civ. Prac. Act, §§ 39, 40; St. William’s Church v. People, supra).
The judgments should be reversed, the counterclaim dismissed and judg-
ment directed to be entered in favor of plaintiff Joseph D. Van Valkenburgh for
the relief prayed for in the complaint subject to the existing easement (Lutz v.
Van Valkenburgh, 274 App. Div. 813), with costs in all courts.

Fuld, J. (dissenting). In my judgment, the weight of evidence lies with the deter-
mination made by the court at Special Term and affirmed by the Appellate
Division. But whether that is so or not, there can be no doubt whatsoever that the
record contains some evidence that the premises here involved were occupied
by William Lutz, defendant’s late husband, for fifteen years under a claim of
title — and that, of course, should compel an affirmance.
The four lots in suit, located in the city of Yonkers, comprise a fairly level
parcel of land, triangular in shape, with approximate dimensions of 150 by 126
by 170 feet. It is bounded on the north by a “traveled way,” on the west and
south by Gibson Place, an unopened street, and on the southeast by a vacant lot.
Immediately to the east of the parcel, the land descends sharply to Leroy Avenue,
forming a steep hill; on the hill are situated two lots, purchased by Lutz in 1912,
upon which his family’s home has stood for over thirty years.
Wild and overgrown when the Lutzes first moved into the neighborhood,
the property was cleared by defendant’s husband and had been, by 1916, the
referee found, developed into a truck farm “of substantial size.” Lutz, together
with his children, worked the farm continuously until his death in 1948; indeed,
after 1928, he had no other employment. Each year, a new crop was planted and
the harvest of vegetables was sold to neighbors. Lutz also raised chickens on the
premises, and constructed coops or sheds for them. Fruit trees were planted, and
timber was cut from that portion of the property not used for the farm. On one
of the lots, Lutz in 1920 built a one-room dwelling, in which his brother Charles
has lived ever since.
Although disputing the referee’s finding that the dimensions of Lutz’s farm
were substantial, the court’s opinion fails to remark the plentiful evidence in sup-
port thereof. For instance, there is credible testimony in the record that “nearly
all” of the property comprised by the four lots was cultivated during the period to
which the referee’s finding relates. A survey introduced in evidence indicates the
very considerable extent to which the property was cultivated in 1950, and many
82

witnesses testified that the farm was no larger at that time than it had ever been.
There is evidence, moreover, that the cultivated area extended from the “traveled
way” on one side of the property to a row of logs and brush — placed by Lutz for
the express purpose of marking the farm’s boundary — at the opposite end of the
premises.
According to defendant’s testimony, she and her husband, knowing that
they did not have record title to the premises, intended from the first neverthe-
less to occupy the property as their own. Bearing this out is the fact that Lutz
put down the row of logs and brush, which was over 100 feet in length, to mark
the southwestern boundary of his farm; this marker, only roughly approximating
the lot lines, extended beyond them into the bed of Gibson Place. The prop-
erty was, moreover, known in the neighborhood as “Mr. Lutz’s gardens,” and the
one-room dwelling on it as “Charlie’s house”; the evidence clearly indicates that
people living in the vicinity believed the property to be owned by Lutz. And it
is undisputed that for upwards of thirty-five years — until 1947, when plaintiffs
became the record owners — no other person ever asserted title to the parcel.
With evidence such as that in the record, I am at a loss to understand how
this court can say that support is lacking for the finding that the premises had
been occupied by Lutz under a claim of title. The referee was fully justified in
concluding that the character of Lutz’s possession was akin to that of a true owner
and indicated, more dramatically and effectively than could words, an intent to
claim the property as his own. Recognizing that “A claim of title may be made
by acts alone, quite as effectively as by the most emphatic assertions” (Barnes v.
Light, 116 N.Y. 34, 39), we have often sustained findings based on evidence of
actual occupation and improvement of the property in the manner that “owners
are accustomed to possess and improve their estates.” (La Frombois v. Jackson, 8
Cow. 589, 603. . . .)
That Lutz knew that he did not have the record title to the property — a
circumstance relied upon by the court — is of no consequence, so long as he
intended, notwithstanding that fact, to acquire and use the property as his own.
As we stated in Ramapo Mfg. Co. v. Mapes (216 N.Y. 362, 370-371), “the bona
fides of the claim of the occupant is not essential and it will not excuse the neg-
ligence of the owner in forbearing to bring his action until after the time in the
Statute of Limitations shall have run against him to show that the defendant
knew all along that he was in the wrong. (Humbert v. Rector, etc., of Trinity
Church, 24 Wend. 587.)”
Quite obviously, the fact that Lutz alleged in the 1947 easement
action — twelve years after the title had, according to the referee, vested in him
through adverse possession — that one of the plaintiffs was the owner of three of
the lots, simply constituted evidence pointing the other way, to be weighed with
the other proof by the courts below. While it is true that a disclaimer of title by
the occupant of property, made before the statutory period has run, indelibly
stamps his possession as nonadverse and prevents title from vesting in him . . . , a
disclaimer made after the statute has run carries with it totally different legal con-
sequences. Once title has vested by virtue of adverse possession, it is elementary
that it may be divested, not by an oral disclaimer, but only by a transfer complying
with the formalities prescribed by law. . . .
83

Hence, an oral acknowledgment of title in another, made after the statutory


period is alleged to have run, “is only evidence tending to show the character of
the previous possession.” (Smith v. Vermont Marble Co., 99 Vt. 384, 394. . . .)
Here, Official Referee Close, of the opinion that the 1947 admission was
made by Lutz under the erroneous advice of his attorney (cf. Shirey v. Whitlow, 80
Ark. 444, 446-447), chose to rest his decision rather on evidence of Lutz’s numer-
ous and continual acts of dominion over the property — proof of a most persua-
sive character. Even if we were to feel that the referee was mistaken in so weighing
the evidence, we would be powerless to change the determination, where, as we
have seen, there is some evidence in the record to support his conclusion.
In view of the extensive cultivation of the parcel in suit, there is no substance
to the argument that the requirements of sections 39 and 40 of the Civil Practice
Act were not met. Under those provisions, only the premises “actually occupied”
in the manner prescribed — that is, “protected by a substantial inclosure” or “usu-
ally cultivated or improved” — are deemed to have been held adversely. The object
of the statute, we have recognized, “is that the real owner may, by unequivocal
acts of the usurper, have notice of the hostile claim and be thereby called upon to
assert his legal title.” (Monnot v. Murphy, 207 N.Y. 240, 245; see, also, Trustees of
Town of East Hampton v. Kirk, 84 N.Y. 215, 220.) Since the character of the acts
sufficient to afford such notice “depends upon the nature and situation of the
property and the uses to which it can be applied,” it is settled that the provisions
of sections 39 and 40 are to be construed, not in a narrow or technical sense, but
with reference to the nature, character, condition, and location of the property
under consideration. . . .
Judge Dye considers it significant that the proof “fails to show that the cul-
tivation incident to the garden utilized the whole of the premises claimed” [see
page 83]. There surely is no requirement in either statute or decision that proof
of adverse possession depends upon cultivation of “the whole” plot or of every foot of
the property in question. And, indeed, the statute — which, as noted, reads “usu-
ally cultivated or improved” — has been construed to mean only that the claim-
ant’s occupation must “consist of acts such as are usual in the ordinary cultivation
and improvement of similar lands by thrifty owners.” (Ramapo Mfg. Co. v. Mapes,
supra, 216 N.Y. 362, 373.) The evidence demonstrates that by far the greater part
of the four lots was regularly and continuously used for farming, and, that being
so, the fact that a portion of the property was not cleared should not affect the
claimant’s ability to acquire title by adverse possession: any frugal person, own-
ing and occupying lands similar to those here involved, would have permitted, as
Lutz did, some of the trees to stand — while clearing the bulk of the property — in
order to provide a source of lumber and other tree products for his usual needs.
The portion of the property held subservient to the part actively cultivated is
as much “occupied” as the portion actually tilled. The nature of the cultivation
engaged in by Lutz was more than adequate, as his neighbors’ testimony estab-
lishes, to give the owner notice of an adverse claim and to delimit the property
to which the claim related. The limits of the parcel in suit were indicated in a
general way by boundaries natural as well as man-made: the declivity to Leroy
Avenue, the “traveled way,” and Gibson Place. Apart from that, however, the evi-
dence discloses that the bulk of each of the four lots was cultivated, and — even
84

putting to one side the fact that the cottage, called “Charlie’s house,” had been
actually occupied and lived in for upwards of thirty years — such substantial use
was enough to put the owner on notice that his whole lot was claimed.
In short, there is ample evidence to sustain the finding that William Lutz
actually occupied the property in suit for over fifteen years under a claim of title.
Since, then, title vested in Lutz by 1935, the judgment must be affirmed. To rule
otherwise, on the ground that the weight of evidence is against that finding — a
view which I do not, in any event, hold — is to ignore the constitutional provision
that limits our jurisdiction to the review of questions of law (N.Y. Const., art. VI,
§7; see also, Civ. Prac. Act, §605).
I would affirm the judgment reached by both of the courts below.
Lewis, Conway and Froessel, JJ., concur with Dye, J.; Fuld, J., dissents in opin-
ion in which Loughran, Ch. J., and Desmond, J., concur.

POSTSCRIPT
Litigation between the Van Valkenburghs and the Lutzes did not end with the
principal case. The Van Valkenburghs’ judgment included costs and disbursements,
and an execution was issued directing the sale of lots 14 and 15 (the Lutz home)
to pay the judgment. In the meantime Mary Lutz had transferred all her interest
in her home to her son Eugene, who resided there with his mother, his wife, and
his child. Eugene moved to set aside the execution and underlying lien, and the
motion was granted; the Van Valkenburghs moved for a rehearing, and this was
denied. The Van Valkenburghs then appealed the order denying the rehearing
instead of appealing, as they should have, the order granting Eugene’s motion.
They lost. Van Valkenburgh v. Lutz, 175 N.Y.S.2d 203 (App. Div. 1958). By a lawyer’s
procedural error, the Lutz home was saved for Mary and Eugene. (Query: Was the
lawyer liable to the Van Valkenburghs for malpractice?)
William Lutz’s brother Charlie was mentally incompetent; after the principal
case, Eugene was appointed as his guardian. Charlie had not been a party to the
prior proceedings, so he was in position to contest them. Through his guardian he
brought an action against the Van Valkenburghs to enjoin removal of “his” house
from lot 19. Charlie claimed that he and his brother William had constructed
the house over 20 years earlier and that when this house was being constructed
he believed he was building it on William’s land. He further claimed that, since
1917, he had been in possession of the house as the tenant of William, the owner,
and that he paid rent to William for the house. This lawsuit wound its way up and
down the courts until 1968, when the Court of Appeals unanimously ruled for the
Van Valkenburghs on the ground that Charlie’s occupation was not under a claim
of title. Lutz v. Van Valkenburgh, 237 N.E.2d 844 (N.Y. 1968). By this time Charlie
was well into his eighties.
Eugene Lutz and his wife continued to live in the Lutz house. The traveled way,
bounded by a tall chain link fence, and the house were guarded by two ferocious
dogs, whose menacing bark warned strangers away. The Van Valkenburghs
are dead. The triangular tract — the subject of this bitter dispute between
neighbors — is now owned by a church. For more about the Lutz case and the
85

contestants, see R.H. Helmholz, The Saga of Van Valkenburgh v. Lutz: Animosity
and Adverse Possession in Yonkers, in Property Stories 59 (Gerald Korngold &
Andrew P. Morriss eds. 2d ed. 2009); Note, New York Adverse Possession Law as a
Conspiracy of Forgetting: Van Valkenburgh v. Lutz and the Examination of Intent,
14 Cardozo L. Rev. 1089 (1993).

NOTES AND QUESTIONS

1. Huh? We noted earlier that the majority decision in Lutz can’t really mean
what it says. According to the decision, the Lutzes lost, among other reasons,
because they did not meet the requirement, set out in § 39 of the New York statute
(see footnote 16), of occupation “under a claim of title” (which the court took to
include a “hostile” claim; see page 80). The court then concluded that the struc-
ture built for Charlie didn’t count because “Lutz knew at the time it was not on
his land,” and that the garage encroachment didn’t count because “Lutz thought
he was getting it on his own property, which certainly falls short of establishing
that he did it under a claim of title hostile to the true owner.” Putting these bits
together, the decision amounts to saying, nonsensically, that in New York you can
only adversely possess land that is already yours! Do you see that?
2. States of mind.  The requirement that adverse possession be accompanied
by a “claim of title” is embodied in the statutes of various states, and even when it
is not, a considerable number of courts have read it in, whether in terms of claim
of title, claim of right, or hostility.
But what does this requirement mean? A good way to approach the inquiry
is in terms of the state of mind required of the adverse possessor, and in this
respect existing doctrine reflects three different views: (1) State of mind is irrel-
evant. (2) The required state of mind is, “I thought I owned it.” (3) The required
state of mind is, “I thought I didn’t own it, but I intended to make it mine.” These
have been called, respectively, “the objective standard, the good-faith standard,
and the aggressive trespass standard.” Margaret Jane Radin, Time, Possession,
and Alienation, 64 Wash. U. L.Q. 739, 746-747 (1986).
The first view is firmly held in England, where the statute of limitations begins
to run as soon as the true owner is dispossessed by someone taking possession
inconsistent with — not subordinate to — his title. See Robert Megarry & H.W.R.
Wade, The Law of Real Property 1307 (Charles Harpum ed., 6th ed. 2000). The
point behind this view is simple: Once there is an entry against the true owner,
she has a cause of action. Given that, shouldn’t the statute of limitations be run-
ning, whatever the entrant’s state of mind? See 3 American Law of Property §15.4
(1952), endorsing the view and suggesting it is the majority position in the United
States; Totman v. Malloy, 725 N.E.2d 1045, 1048 (Mass. 2000) (“We have long held
that the state of mind of the claimant is not relevant to a determination whether
the possession of land is nonpermissive.”); Tioga Coal Co. v. Supermarkets Gen.
Corp., 546 A.2d 1 (Pa. 1988) (if all other requirements of adverse possession have
been met, hostility will be implied, regardless of the subjective state of mind of the
86

adverse possessor); Chaplin v. Sanders, 676 P.2d 431, 436 (Wash. 1984) (adverse
possessor’s “subjective belief regarding his true interest in the land and his intent
to dispossess or not dispossess another is irrelevant”).
The second view, requiring a good-faith claim, is voiced from time to time
in American decisions. An example is Halpern v. Lacy Inv. Corp., 379 S.E.2d 519
(Ga. 1989), where the court said:

We hold that the correct rule is that one must enter upon the land claiming
in good faith the right to do so. To enter upon the land without any honest claim
of right to do so is but a trespass and can never ripen into prescriptive title. In the
language used in Hannah v. Kenny, 210 Ga. 824, 83 S.E.2d 1 (1954), such a person
is called a “squatter.” . . . Here there was evidence that the Halperns knew the parcel
of land was owned by another yet they simply took possession when their offer to
purchase was declined. There was evidence to support a finding that this possession
never changed its character.
One may maintain hostile possession of land in good faith. . . . [H]ostile pos-
session and claim of right are legal equivalents for all practical purposes. The hold-
ing is that most who have hostile possession of land do so with a good faith claim
of right and therefore a jury or other factfinder may, in the absence of a contrary
showing, infer from hostile possession that it is done in good faith that a claim of
right exists. [379 S.E.2d at 521.]17

Professor Helmholz claims that the good-faith requirement plays a larger


role than might at first appear. Based on an extensive survey of recent cases,
he concludes that many courts do take account of state of mind — though they
might not say as much — in cases where the evidence strongly suggests that the
adverse possessor was well aware he was trespassing. Manipulating the hostility
and claim-of-right requirements, the courts “regularly award title to the good
faith trespasser, where they will not award it to the trespasser who knows what he
is doing at the time he enters the land in dispute.” Richard H. Helmholz, Adverse
Possession and Subjective Intent, 61 Wash. U. L.Q. 331, 356-358 (1983). A reply
to Helmholz’s article argues that the cases surveyed provide no basis for his con-
clusions. Roger A. Cunningham, Adverse Possession and Subjective Intent: A
Reply to Professor Helmholz, 64 Wash. U. L.Q. 1 (1986).
The third view, that of the aggressive trespasser, is reflected in Preble
v. Maine Cent. R. Co., quoted and discussed on pages 90-91. That case stands
for the proposition that (at least in the case of boundary disputes) to qualify as
adverse possessors, occupants must intend to take the property even if they know
it doesn’t belong to them. One way of dealing with aggressive (sometimes called
bad-faith) adverse possession is to award title, but only if the adverse possessor
agrees to pay fair market value to the dispossessed former owner. Title would
go to the adverse possessor for some of the reasons we have adverse possession
to begin with — for example, to protect the interests of third parties who relied

17. Notice the reference to “squatters,” who, the court suggests, cannot become adverse possessors. Why
should that be? In any event, and especially given the increasingly apparent problem of homelessness in the
United States (to which we shall return), should squatters have rights — say to occupy vacant and abandoned
buildings?
87

upon the appearance of ownership. But the obligation to compensate would be


imposed to punish and deter the consciously wrongful activity. For a discussion,
see Thomas W. Merrill, Property Rules, Liability Rules, and Adverse Possession,
79 Nw. U. L. Rev. 1122 (1984). See also Noel Elfant, Comment, Compensation
for the Involuntary Transfer of Property Between Private Parties: Application of
a Liability Rule to the Law of Adverse Possession, 79 Nw. U. L. Rev. 758 (1984),
advancing the same idea for all adverse possession cases.18 Both articles were pro-
voked by Warsaw v. Chicago Metallic Ceilings, Inc., 676 P.2d 584 (Cal. 1984),
concerning a prescriptive easement, when the court considered, but ultimately
rejected, a compensation requirement (we take up prescriptive easements in
Chapter 11). The compensation requirement is analyzed in Richard A. Epstein,
Past and Future: The Temporal Dimension in the Law of Property, 64 Wash. U.
L.Q. 667, 688-689 (1986) (favoring instead a two-tier statute of limitations with
a longer period for bad-faith possessors); Thomas J. Miceli & C.F. Sirmans, An
Economic Theory of Adverse Possession, 15 Intl. Rev. L. & Econ. 161 (1995).19
3. The demise and rebirth of Lutz.  The majority decision in Lutz was overruled
(although not in so many words) by Walling v. Przybylo, 851 N.E.2d 1167, 1169-
1170 (N.Y. 2006), the court holding that there can be a claim of right even if
the adverse possessor knows that the land in question belongs to someone else.
The court found the facts in Lutz to be “distinguishable,” and described as “mis-
taken dictum” any language in Lutz “that may seem inconsistent with our holding
here.” But that was not the end of the story. New York legislators were unhappy
with Walling ; they wanted a rule that would “discourage persons from attempting
to possess land they knew did not belong to them.” The governor vetoed their
first effort to change the law, but the second succeeded, in 2008. See, e.g., N.Y.
Real Prop. Actions & Proc. § 501(3) (McKinney 2009), defining the “claim of
right” requirement: “A claim of right means a reasonable basis for the belief that
the property belongs to the adverse possessor or property owner, as the case may
be.” The new provision is said to be “‘all about good faith.’”
The quotations in the foregoing are drawn from Practice Commentaries
written by Rudolph de Winter and Larry M. Loeb, appended to § 501. The

18. In the title of these two articles you see mention of property rules and liability rules. The labels have
become terms of art after an influential article by Guido Calabresi & A. Douglas Melamed, Property Rules,
Liability Rules and Inalienability: One View of the Cathedral, 85 Harv. L. Rev. 1089 (1972). When a property
interest is protected by a property rule, the interest cannot be taken from its owner without the owner’s consent;
all transfers are voluntary. When a property interest is protected by a liability rule, the interest can be taken
without the owner’s consent but only upon payment of judicially determined damages; transfers are forced.
Ordinary adverse possession doctrine protects (1) the owner’s interest with a property rule before the statute
of limitations has run, then (2) the adverse possessor’s interest with a property rule after the statute has run.
The compensation approach discussed above would observe (1) but as to (2) would leave in the owner — after
the statute has run — an interest protected by a liability rule. Transfer of the owner’s interest to the adverse pos-
sessor could be forced but only upon payment of compensatory damages by the latter.
We shall explore the property rule-liability rule dichotomy in various places throughout this book. See in
particular Note 3 on pages 805-807.
19. For a dramatically different approach to bad-faith adverse possessors, see Lee Anne Fennell, Efficient
Trespass: The Case for “Bad Faith” Adverse Possession, 100 Nw. U. L. Rev. 1037 (2006), suggesting that better
terms for “good-faith” and “aggressive” (or “bad-faith”) would be “inadvertent” and “knowing,” so as not to
color the behavior in question. Id. at 1037-1038 n.1. Professor Fennell develops the argument for an efficient
adverse possession doctrine, one in which the contested land would move from a lower-valuing owner to a
higher-valuing trespasser. One element of her argument runs directly counter to the conventional wisdom: Her
suggested approach would operate only on behalf of knowing trespassers — that is, on behalf of what are usually
regarded today as undeserving claimants.
88

Commentaries end as follows: “It remains for the courts to determine if the new
legislation accomplishes the Legislature’s goals. It is possible that § 501 may be
read to be circular. A party possessing property may be found to not initially have
had a claim of right but having possessed the property for the statutory period
may acquire a claim of right and mature into an adverse possessor.”

NOTE: COLOR OF TITLE AND CONSTRUCTIVE ADVERSE


POSSESSION

The “claim of title” required by the New York statutes, and at issue in Van
Valkenburgh v. Lutz, is quite different from “color of title.” Claim of title is simply
one way of expressing the requirement of hostility or claim of right on the part of
an adverse possessor. Color of title, on the other hand, refers to a claim founded on
a written instrument (a deed, a will) or a judgment or decree that is for some rea-
son defective and invalid (as when the grantor does not own the land conveyed
by deed or is incompetent to convey, or the deed is improperly executed). Claim
under color of title was not required by English law and is not required in most
American jurisdictions. In a few states, color of title is essential to acquiring title
by adverse possession. What might be the rationale for the concept of color of
title? Should it be required in all cases? Dispensed with in all?
Even though color of title is not a prerequisite for adverse possession in
most states, it has important advantages for the adverse possessor. Notice, for
example, that the statutes involved in Van Valkenburgh v. Lutz set out different
requirements for claims of title “founded upon a written instrument or a judg-
ment or decree” and those not so founded. (See footnote 16 on page 79.) The
requirements in the first case are slightly more lenient than those in the second.
In some states a shorter statute of limitations is applicable to adverse possessors
with color of title than to those without. In all states entry with color of title may
have an advantage where the adverse possessor enters into possession of only a
part of the property. Actual possession under color of title of only a part of the
land covered by the defective writing is constructive possession of all that the writ-
ing describes. The advantage that a person may gain from constructive possession
is that the activities relied upon to establish adverse possession reach not only
the part of the premises actually occupied, but the entire premises described in
a deed to the claimant. This doctrine of constructive adverse possession under
color of title, established by judicial rule in some states and by statute in oth-
ers, is, however, subject to some limitations. Several of them are explored in the
Problems that follow.

PROBLEMS

1. O owns and has been in possession of a 100-acre farm since 1975. In 1994
A entered the back 40 acres under color of an invalid deed from Z (who had no
claim to the land) for the entire 100 acres. Since her entry, A has occupied and
89

improved the back 40 in the usual manner for the period required by the statute
of limitations. A brings suit to evict O from the farm, claiming title by construc-
tive adverse possession. What result? See Patrick v. Goolsby, 11 S.W.2d 677 (Tenn.
1928). Suppose that in 1975 O took title to the farm under an invalid deed and
has been in possession for a period sufficient to satisfy the statute of limitations.
Would the result in the suit by A be different? What if the statute has not yet run
in O’s favor?
2. Two contiguous lots, 1 and 2, are owned by X and Y respectively. (X and Y
are not in possession.) The lots are conveyed by an invalid deed from Z to A, who
enters lot 1 and occupies it in the usual manner for the period required by the
statute of limitations. Subsequently A sues X and Y to quiet title to lots 1 and 2.
What result? Would it matter if X had signed the deed? If X had signed the deed
and A had entered lot 2? See Wheatley v. San Pedro, Los Angeles & Salt Lake
Railroad, 147 P. 135 (Cal. 1915); Brock v. Howard, 200 S.W.2d 734 (Ky. 1947).
The case that follows concerns a boundary dispute, now the most frequently
litigated of adverse possession claims. You will notice that the question of the
claimant’s state of mind, a matter considered at length after the Lutz case (see
Note 2 beginning on page 85), comes up once again, in the special context of
mistake. The notoriety requirement can take on a special twist here as well.

Mannillo v. Gorski
Supreme Court of New Jersey, 1969
255 A.2d 258

Haneman, J. Plaintiffs filed a complaint in the Chancery Division seeking a man-


datory and prohibitory injunction against an alleged trespass upon their lands.
Defendant counterclaimed for a declaratory judgment which would adjudicate
that she had gained title to the disputed premises by adverse possession under
N.J.S. 2A:14-6, N.J.S.A., which provides:

Every person having any right or title of entry into real estate shall make such
entry within 20 years next after the accrual of such right or title of entry, or be
barred therefrom thereafter.

After plenary trial, judgment was entered for plaintiffs. Mannillo v. Gorski, 100 N.J.
Super. 140, 241 A.2d 276 (Ch. Div. 1968). Defendant appealed to the Appellate
Division. Before argument there, this Court granted defendant’s motion for
certification.
The facts are as follows: In 1946, defendant and her husband entered into
possession of premises in Keansburg known as Lot No. 1007 in Block 42, under
an agreement to purchase. Upon compliance with the terms of said agreement,
the seller conveyed said lands to them on April 16, 1952. Defendant’s husband
thereafter died. The property consisted of a rectangular lot with a frontage of 25
feet and a depth of 100 feet. Plaintiffs are the owners of the adjacent Lot 1008 in
Block 42 of like dimensions, to which they acquired title in 1953.
90

In the summer of 1946 Chester Gorski,20 one of the defendant’s sons, made
certain additions and changes to the defendant’s house. He extended two rooms
at the rear of the structure, enclosed a screened porch on the front, and put a
concrete platform with steps on the west side thereof for use in connection with a
side door. These steps were built to replace existing wooden steps. In addition, a
concrete walk was installed from the steps to the end of the house. In 1953, defen-
dant raised the house. In order to compensate for the resulting added height
from the ground, she modified the design of the steps by extending them toward
both the front and the rear of the property. She did not change their width.
Defendant admits that the steps and concrete walk encroach upon plain-
tiffs’ lands to the extent of 15 inches. She contends, however, that she has title to
said land by adverse possession. N.J.S.A. 2A:14-6, quoted above. Plaintiffs assert
contrawise that defendant did not obtain title by adverse possession as her pos-
session was not of the requisite hostile nature. They argue that to establish title
by adverse possession, the entry into and continuance of possession must be
accompanied by an intention to invade the rights of another in the lands, i.e., a
knowing wrongful taking. They assert that, as defendant’s encroachment was not
accompanied by an intention to invade plaintiffs’ rights in the land, but rather
by the mistaken belief that she owned the land, and that therefore an essential
requisite to establish title by adverse possession, i.e., an intentional tortious tak-
ing, is lacking.
The trial court concluded that defendant had clearly and convincingly
proved that her possession of the 15-inch encroachment had existed for more
than 20 years before the institution of this suit and that such possession was
“exclusive, continuous, uninterrupted, visible, notorious and against the right
and interest of the true owner.” There is ample evidence to sustain this finding
except as to its visible and notorious nature, of which more hereafter. However,
the judge felt impelled by existing New Jersey case law, holding as argued by
plaintiffs above, to deny defendant’s claim and entered judgment for plaintiffs.
100 N.J. Super., at 150, 241 A.2d 276. The first issue before this Court is, there-
fore, whether an entry and continuance of possession under the mistaken belief
that the possessor has title to the lands involved, exhibits the requisite hostile
possession to sustain the obtaining of title by adverse possession.
The first detailed statement and acceptance by our then highest court, of
the principle that possession as an element of title by adverse possession cannot
be bottomed on mistake, is found in Folkman v. Myers, 93 N.J. Eq. 208, 115 A. 615
(E. & A. 1921). . . . In so doing, the former Court of Errors and Appeals aligned
this State with that branch of a dichotomy which traces its genesis to Preble v.
Maine Cent. R. Co., 85 Me. 260, 27 A. 149, 21 L.R.A. 829 (Sup. Jud. Ct. Me. 1893)
and has become known as the Maine doctrine. In Preble, the court said at 27 A. at
p. 150:

Indeed, the authorities all agree that this intention of the occupant to claim
the ownership of land not embraced in his title is a necessary element of adverse

20. Chester Gorski was 14 years old at the time and, in adulthood, became a general contractor, building
houses. — Eds.
91

possession; and in case of occupancy by mistake beyond a line capable of being


ascertained this intention to claim title to the extent of the occupancy must appear
to be absolute, and not conditional; otherwise the possession will not be deemed
adverse to the true owner. It must be an intention to claim title to all land within a
certain boundary on the face of the earth, whether it shall eventually be found to
be the correct one or not. If, for instance, one in ignorance of his actual boundaries
takes and holds possession by mistake up to a certain fence beyond his limits, upon
the claim and in the belief that it is the true line, with the intention to claim title,
and thus, if necessary, to acquire “title by possession” up to that fence, such posses-
sion, having the requisite duration and continuity, will ripen into title.
If, on the other hand, a party through ignorance, inadvertence, or mistake
occupies up to a given fence beyond his actual boundary, because he believes it
to be the true line, but has no intention to claim title to that extent if it should be
ascertained that the fence was on his neighbor’s land, an indispensable element of
adverse possession is wanting. In such a case the intent to claim title exists only upon
the condition that the fence is on the true line. The intention is not absolute, but
provisional, and the possession is not adverse.

This thesis, it is evident, rewards the possessor who entered with a premeditated
and predesigned “hostility” — the intentional wrongdoer — and disfavors an hon-
est, mistaken entrant. 3 American Law of Property (Casner ed. 1952), § 104, pp.
773, 785. . . .
The other branch of the dichotomy relies upon French v. Pearce, 8 Conn.
439 (Sup. Ct. Conn. 1831). The court said in Pearce on the question of the sub-
jective hostility of a possessor, at pp. 442, 445-446:

Into the recesses of his (the adverse claimant’s) mind, his motives or purposes,
his guilt or innocence, no enquiry is made.
. . . The very nature of the act (entry and possession) is an assertion of his own
title, and the denial of the title of all others. It matters not that the possessor was
mistaken, and had he been better informed, would not have entered on the land.

The Maine doctrine has been the subject of much criticism in requiring a
knowing wrongful taking. The criticism of the Maine and the justification of the
Connecticut branch of the dichotomy is well stated in 6 Powell, Real Property
(1969), § 1015, pp. 725-728:

Do the facts of his possession, and of his conduct as if he were the owner,
make immaterial his mistake, or does such a mistake prevent the existence of the
prerequisite claim of right? The leading case holding the mistake to be of no impor-
tance was French v. Pearce, decided in Connecticut in 1831. . . . This viewpoint has
gained increasingly widespread acceptance. The more subjectively oriented view
regards the “mistake” as necessarily preventing the existence of the required claim
of right. The leading case on this position is Preble v. Maine Central R.R., decided
in 1893. This position is still followed in a few states. It has been strongly criticized
as unsound historically, inexpedient practically, and as resulting in better treatment
for a ruthless wrongdoer than for the honest landowner. . . . On the whole the law is
simplified, in the direction of real justice, by a following of the Connecticut leader-
ship on this point.
92

Again, 4 Tiffany, Real Property (3d ed. 1939), 1159, pp. 474-475, criticizes the
employment of mistake as negating hostility as follows:

In no case except in that of a mistake as to boundary has the element of mis-


take been regarded as having any significance, and there is no reason for attributing
greater weight thereto when the mistake is as to the proper location of a boundary
than when it is a mistake as to the title to all the land wrongfully possessed. And to
introduce the element of mistake, and then limit its significance by an inquiry as to
the intention which the possessor may have as to his course of action in case there
should be a mistake, an intention which has ordinarily no existence whatsoever,
is calculated only to cause confusion without, it is conceived, any compensating
advantage.

We are in accord with the criticism of the Maine doctrine and favor the
Connecticut doctrine for the above quoted reasons.21 As far as can be seen, over-
ruling the former rule will not result in undermining any of the values which
stare decisis is intended to foster. The theory of reliance, a cornerstone of stare
decisis, is not here apt, as the problem is which of two mistaken parties is entitled
to land. Realistically, the true owner does not rely upon entry of the possessor
by mistake as a reason for not seeking to recover possession. Whether or not the
entry is caused by mistake or intent, the same result eventuates — the true owner
is ousted from possession. In either event his neglect to seek recovery of posses-
sion, within the requisite time, is in all probability the result of a lack of knowl-
edge that he is being deprived of possession of lands to which he has title.
Accordingly, we discard the requirement that the entry and continued pos-
session must be accompanied by a knowing intentional hostility and hold that
any entry and possession for the required time which is exclusive, continuous,
uninterrupted, visible and notorious, even though under mistaken claim of title,
is sufficient to support a claim of title by adverse possession.
However, this conclusion is not dispositive of the matter sub judice. Of equal
importance under the present factual complex, is the question of whether defen-
dant’s acts meet the necessary standard of “open and notorious” possession. . . .
Generally, where possession of the land is clear and unequivocal and to
such an extent as to be immediately visible, the owner may be presumed to have
knowledge of the adverse occupancy. . . . However, when the encroachment of
an adjoining owner is of a small area and the fact of an intrusion is not clearly
and self-evidently apparent to the naked eye but requires an on-site survey for
certain disclosure as in urban sections where the division line is only infrequently
delineated by any monuments, natural or artificial, such a presumption is falla-
cious and unjustified. The precise location of the dividing line is then ordinarily
unknown to either adjacent owner and there is nothing on the land itself to show
by visual observation that a hedge, fence, wall or other structure encroaches on
the neighboring land to a minor extent. Therefore, to permit a presumption of
notice to arise in the case of minor border encroachments not exceeding several

21. Maine itself has abandoned the Maine doctrine. See Dombkowski v. Ferland, 893 A.2d 599 (Me.
2006). — Eds.
93

feet would fly in the face of reality and require the true owner to be on constant
alert for possible small encroachments. The only method of certain determina-
tion would be by obtaining a survey each time the adjacent owner undertook
any improvement at or near the boundary, and this would place an undue and
inequitable burden upon the true owner. Accordingly we hereby hold that no
presumption of knowledge arises from a minor encroachment along a common
boundary. In such a case, only where the true owner has actual knowledge thereof
may it be said that the possession is open and notorious.
It is conceivable that the application of the foregoing rule may in some
cases result in undue hardship to the adverse possessor who under an innocent
and mistaken belief of title has undertaken an extensive improvement which to
some extent encroaches on an adjoining property. In that event the situation falls
within the category of those cases of which Riggle v. Skill, 9 N.J. Super. 372, 74
A.2d 424 (Ch. Div. 1950), affirmed, 7 N.J. 268, 81 A.2d 364 (1951), is typical and
equity may furnish relief. Then, if the innocent trespasser of a small portion of
land adjoining a boundary line cannot without great expense remove or elimi-
nate the encroachment, or such removal or elimination is impractical or could
be accomplished only with great hardship, the true owner may be forced to con-
vey the land so occupied upon payment of the fair value thereof without regard
to whether the true owner had notice of the encroachment at its inception. Of
course, such a result should eventuate only under appropriate circumstances and
where no serious damage would be done to the remaining land as, for instance,
by rendering the balance of the parcel unusable or no longer capable of being
built upon by reason of zoning or other restrictions.
We remand the case for trial of the issues (1) whether the true owner had
actual knowledge of the encroachment, (2) if not, whether plaintiffs should be
obliged to convey the disputed tract to defendant, and (3) if the answer to the
latter question is in the affirmative, what consideration should be paid for the
conveyance. The remand, of course, contemplates further discovery and a new
pretrial.
Remanded for trial in accordance with the foregoing.
[After the case was remanded for trial, the parties settled. Mrs. Gorski paid
Mannillo $250, and in exchange Mannillo gave her the land covered by the
encroachment.]

NOTES, QUESTIONS, AND PROBLEMS

1. Mistake.  Most jurisdictions have abandoned the Maine doctrine. Is that a


good thing? Recall the discussion in Note 2 on page 85.
2. Notoriety.  The court in Mannillo says that in the case of minor encroach-
ments, the owner of the land must have “actual knowledge thereof” in order for
the adverse claimant to satisfy the notoriety requirement. Suppose that a friend
of the plaintiffs’ had told them one day more than 20 years prior to the lawsuit,
“I hear there’s a problem with your neighbor’s house, that the new part they
built might go too far.” Plaintiffs thereafter do nothing. Are they on any sort
of notice? In any event, if “actual notice” is truly required in the case of minor
94

encroachments, still a question remains: “Actual notice” of what? Suppose the


plaintiffs knew of an encroachment but thought that it was only 3 inches. Is there
notorious possession as to 3 inches, or 15 inches, or no inches?
3. Mistaken boundaries.  A and B own adjacent lots. A erects a fence on what
she mistakenly assumes to be the true boundary line dividing the lots; in fact
the fence is erected on B’s lot three feet beyond the boundary. A thereafter acts
as the owner of all the land on her side of the fence for the statutory period.
Suppose that as a consequence of these actions A acquires title by adverse pos-
session. Later, after the statute has run, a survey by B reveals the mistake. B tells
this to A, and A, “to avoid a hassle,” tears down her fence and erects a new fence
on the original true boundary. Three years later A talks to a lawyer, changes her
mind, and sues to eject B from the three feet. What result? See Kline v. Kramer,
386 N.E.2d 982 (Ind. App. 1979); Mugaas v. Smith, 206 P.2d 332 (Wash. 1949).
Boundary disputes may also be resolved by the doctrines of agreed boundar-
ies, estoppel, and acquiescence. The doctrine of agreed boundaries provides that
if there is uncertainty between neighbors as to the true boundary line, an oral
agreement to settle the matter is enforceable if the neighbors subsequently accept
the line for a long period of time. The doctrine of estoppel comes into play when
one neighbor makes representations about (or engages in conduct that tends
to indicate) the location of a common boundary, and the other neighbor then
changes her position in reliance on the representations or conduct. The first
neighbor is then estopped to deny the validity of his statements or acts. Estoppel
has also been applied when one neighbor remains silent in the face of expendi-
tures by another that suggest the latter’s notion of the boundary’s location. The
doctrine of acquiescence provides that long acquiescence — though perhaps for a
period of time shorter than the statute of limitations — is evidence of an agree-
ment between the parties fixing the boundary line. Anderson v. Fautin, 379 P.3d
1186 (Utah 2016), provides a recent interesting application of acquiescence doc-
trine. In the case, the alleged encroachment on a neighbor’s parcel had endured
for many years longer than the period required by the statute of limitations, but
the statute had not run because the encroacher failed to pay property taxes as
required by Utah’s adverse possession statutes. Recall the discussion in footnote
12 on page 75. The court ended up finding acquiescence even though the owner
of the neighboring property had not visited it for many years.
The three doctrines discussed above are commonly interwoven by the
courts, leaving the law vague and tricky to apply. See Mehdizadeh v. Mincer, 54
Cal. Rptr. 2d 284 (Ct. App. 1996); Olin L. Browder, Jr., The Practical Location of
Boundaries, 56 Mich. L. Rev. 487 (1958); Stewart E. Sterk, Estoppel in Property
Law, 77 Neb. L. Rev. 756, 788-794 (1998).
4. Mistaken improvers.  At the end of the opinion in Mannillo (see page 93),
the court discusses the problem of the innocent improver, someone who mis-
takenly builds on land belonging to another but is subsequently ousted from
the land before the statutory period for adverse possession has run. The early
common law on this matter was rather harsh: anything built on the wrong land,
whether in good faith or not, became the property of the landowner (subject to
the usual exceptions for delay, acquiescence, and estoppel). The modern ten-
dency, as Mannillo indicates, is to ease the plight of innocent improvers — in that
95

case, by forcing a conveyance (at market value) of land from the owner to the
improver. A variation is to give the landowner the option to buy the improvement
(again, at market value) instead. Some states have legislation (often called “occu-
pying claimant” or “betterment” acts) that set out these and other remedies.
If the inconvenience caused by an innocent encroachment is so minor
as to be trivial, relief might be denied altogether. If, on the other hand, the
encroachment takes up a substantial part of the land in question, removal might
be ordered notwithstanding the good faith of the encroaching party, depending
upon how the court in a particular case strikes a balance between competing
considerations. See, e.g., Amkco Ltd., Co. v. Wellborn, 21 P.3d 24 (N.M. 2001),
involving an unintentional encroachment that took up almost 10 percent of the
plaintiff’s land. The court applied a two-part test. First, the plaintiff has to show
that it would suffer irreparable harm if removal were denied. But even if irrepa-
rable harm is proved, still the relief might be denied under a balancing test that
compares the hardship to the plaintiff if removal is denied to the hardship to the
defendant if it is granted. If this relative hardship test precludes removal of the
encroachment, the encroaching party acquires either title or an easement in the
land and pays damages accordingly.
Compare intentional encroachments, as to which most courts require
removal of the offending structure, no matter how costly that might be. Why treat
intentional encroachers so harshly? See Stewart E. Sterk, Property Rules, Liability
Rules, and Uncertainty About Property Rights, 106 Mich. L. Rev. 1285, 1296-1297,
1319-1323 (2008).

2. The Mechanics of Adverse Possession

Howard v. Kunto
Court of Appeals of Washington, 1970
477 P.2d 210

Pearson, J. Land surveying is an ancient art but not one free of the errors that
often creep into the affairs of men. In this case, we are presented with the ques-
tion of what happens when the descriptions in deeds do not fit the land the deed
holders are occupying. Defendants appeal from a decree quieting title in the
plaintiffs of a tract of land on the shore of Hood Canal in Mason County.
At least as long ago as 1932 the record tells us that one McCall resided in
the house now occupied by the appellant-defendants, Kunto. McCall had a deed
that described a 50-foot wide parcel on the shore of Hood Canal. The error that
brings this case before us is that the 50 feet described in the deed is not the same
50 feet upon which McCall’s house stood. Rather, the described land is an adja-
cent 50-foot lot directly west of that upon which the house stood. In other words,
McCall’s house stood on one lot and his deed described the adjacent lot. Several
property owners to the west of defendants, not parties to this action, are similarly
situated.
96

Figure 2-2

Over the years since 1946, several conveyances occurred, using the same
legal description and accompanied by a transfer of possession to the succeeding
occupants. The Kuntos’ immediate predecessors in interest, the Millers, desired
to build a dock. To this end, they had a survey performed which indicated that the
deed description and the physical occupation were in conformity. Several bound-
ary stakes were placed as a result of this survey and the dock was constructed, as
well as other improvements. The house as well as the others in the area continued
to be used as summer recreational retreats.
The Kuntos then took possession of the disputed property under a deed
from the Millers in 1959. In 1960 the respondent-plaintiffs, Howard, who held
land east of that of the Kuntos, determined to convey an undivided one-half inter-
est in their land to the Yearlys. To this end, they undertook to have a survey of
the entire area made. After expending considerable effort, the surveyor retained
by the Howards discovered that according to the government survey, the deed
descriptions and the land occupancy of the parties did not coincide. Between the
Howards and the Kuntos lay the Moyers’ property. When the Howards’ survey was
completed, they discovered that they were the record owners of the land occupied
by the Moyers and that the Moyers held record title to the land occupied by the
Kuntos. Howard approached Moyer and in return for a conveyance of the land
97

upon which the Moyers’ house stood, Moyer conveyed to the Howards record
title to the land upon which the Kunto house stood. Until plaintiffs Howard
obtained the conveyance from Moyer in April, 1960, neither Moyer nor any of his
predecessors ever asserted any right to ownership of the property actually being
possessed by Kunto and his predecessors. This action was then instituted to quiet
title in the Howards and Yearlys. The Kuntos appeal from a trial court decision
granting this remedy.
At the time this action was commenced on August 19, 1960,22 the defendants
had been in occupance of the disputed property less than a year. The trial court’s
reason for denying their claim of adverse possession is succinctly stated in its mem-
orandum opinion: “In this instance, defendants have failed to prove, by a prepon-
derance of the evidence, a continuity of possession or estate to permit tacking of
the adverse possession of defendants to the possession of their predecessors.”
Finding of fact 6,23 which is challenged by defendants, incorporates the
above concept and additionally finds defendant’s possession not to have been
“continuous” because it involved only “summer occupancy.”
Two issues are presented by this appeal:
(1) Is a claim of adverse possession defeated because the physical use of the
premises is restricted to summer occupancy?
(2) May a person who receives record title to tract A under the mistaken
belief that he has title to tract B (immediately contiguous to tract A) and who
subsequently occupies tract B, for the purpose of establishing title to tract B by
adverse possession, use the periods of possession of tract B by his immediate pre-
decessors who also had record title to tract A?
In approaching both of these questions, we point out that the evidence,
largely undisputed in any material sense, established that defendant or his immedi-
ate predecessors did occupy the premises, which we have called tract B, as though
it was their own for more than the 10 years as prescribed in RCW 4.16.020.24

22. The inordinate delay in bringing this matter to trial appears from the record to be largely inexcus-
able. However, neither counsel who tried the case was at fault in any way. . . .
23. “In the instant case the defendants’ building was not simply over the line, but instead was built
wholly upon the wrong piece of property, not the property of defendants, described in Paragraph Four of the
complaint herein, but on the property of the plaintiffs, described in Paragraph Three of the complaint and
herein. That the last three deeds in the chain of title, covering and embracing defendants’ property, including
defendants’ deed, were executed in other states, specifically, California and Oregon. And there is no evidence of
pointing out to the grantees in said three deeds, aforesaid, including defendants’ deed, of any specific property,
other than the property of defendants, described in their deed, and in Paragraph Four (4) of the complaint,
and herein; nor of any immediate act of the grantees, including defendants, in said three (3) deeds, aforesaid,
of taking possession of any property, other than described in said three (3) deeds, aforesaid; and the testimony
of husband defendant, was unequivocally that he had no intention of possessing or holding anything other
than what the deed called for; and, that there is no showing of any continuous possession by defendants or their
immediate predecessors in interest, since the evidence indicates the property was in the nature, for use, as a
summer occupancy, and such occupancy and use was for rather limited periods of time during comparatively
short portions of the year, and was far from continuous.”
24. This statute provides:
4.16.020 Actions to be commenced within ten years. The period prescribed in RCW 4.16.010 for
the commencement of actions shall be as follows:
Within ten years;
Actions for the recovery of real property, or for the recovery of the possession thereof; and no
action shall be maintained for such recovery unless it appears that the plaintiff, his ancestor, predecessor
or grantor was seized or possessed of the premises in question within ten years before the commence-
ment of the action.
98

We also point out that finding of fact 6 is not challenged for its factual deter-
minations but for the conclusions contained therein to the effect that the con-
tinuity of possession may not be established by summer occupancy, and that a
predecessor’s possession may not be tacked because a legal “claim of right” did
not exist under the circumstances.
We start with the oft-quoted rule that: “[T]o constitute adverse possession,
there must be actual possession which is uninterrupted, open and notorious, hos-
tile and exclusive, and under a claim of right made in good faith for the statutory
period.” (Italics ours.) Butler v. Anderson, 71 Wash. 2d 60, 64, 426 P.2d 467, 470
(1967).25
We reject the conclusion that summer occupancy only of a summer beach
home destroys the continuity of possession required by the statute. It has become
firmly established that the requisite possession requires such possession and
dominion “as ordinarily marks the conduct of owners in general in holding, man-
aging, and caring for property of like nature and condition.” Whalen v. Smith,
183 Iowa 949, 953, 167 N.W. 646, 647 (1918). . . .
We hold that occupancy of tract B during the summer months for more than
the 10-year period by defendant and his predecessors, together with the con-
tinued existence of the improvements on the land and beach area, constituted
“uninterrupted” possession within this rule. To hold otherwise is to completely
ignore the nature and condition of the property. . . .
We find such rule fully consonant with the legal writers on the subject. In F.
Clark, Law of Surveying and Boundaries, § 561 (3d ed. 1959) at 565: “Continuity
of possession may be established although the land is used regularly for only a
certain period each year.” Further, at 566:

This rule . . . is one of substance and not of absolute mathematical continuity,
provided there is no break so as to sever two possessions. It is not necessary that the
occupant should be actually upon the premises continually. If the land is occupied
during the period of time during the year it is capable of use, there is sufficient
continuity.

We now reach the question of tacking. The precise issue before us is novel in
that none of the property occupied by defendant or his predecessors coincided
with the property described in their deeds, but was contiguous.
In the typical case, which has been subject to much litigation, the party seek-
ing to establish title by adverse possession claims more land than that described in
the deed. In such cases it is clear that tacking is permitted.
In Buchanan v. Cassell, 53 Wash. 2d 611, 614, 335 P.2d 600, 602 (1959), the
Supreme Court stated: “This state follows the rule that a purchaser may tack the
adverse use of its predecessor in interest to that of his own where the land was
intended to be included in the deed between them, but was mistakenly omitted

25. In 1984 the Washington Supreme Court overruled Howard v. Kunto to the extent that the case sug-
gests a good-faith requirement for adverse possession. See Chaplin v. Sanders, cited and quoted in this book at
page 86. — Eds.
99

from the description.” El Cerito, Inc. v. Ryndak, 60 Wash. 2d 847, 376 P.2d 528
(1962).26
The general statement which appears in many of the cases is that tacking
of adverse possession is permitted if the successive occupants are in “privity.”
See Faubion v. Elder, 49 Wash. 2d 300, 301 P.2d 153 (1956). The deed running
between the parties purporting to transfer the land possessed traditionally fur-
nishes the privity of estate which connects the possession of the successive occu-
pants. Plaintiff contends, and the trial court ruled, that where the deed does not
describe any of the land which was occupied, the actual transfer of possession is
insufficient to establish privity.
To assess the cogency of this argument and ruling, we must turn to the his-
torical reasons for requiring privity as a necessary prerequisite to tacking the pos-
session of several occupants. Very few, if any, of the reasons appear in the cases,
nor do the cases analyze the relationships that must exist between successive pos-
sessors for tacking to be allowed. See W. Stoebuck, The Law of Adverse Possession
in Washington in 35 Wash. L. Rev. 53 (1960).
The requirement of privity had its roots in the notion that a succession of
trespasses, even though there was no appreciable interval between them, should
not, in equity, be allowed to defeat the record title. The “claim of right,” “color of
title” requirement of the statutes and cases was probably derived from the early
American belief that the squatter should not be able to profit by his trespass.27
However, it appears to this court that there is a substantial difference between
the squatter or trespasser and the property purchaser, who along with several of
his neighbors, as a result of an inaccurate survey or subdivision, occupies and
improves property exactly 50 feet to the east of that which a survey some 30 years
later demonstrates that they in fact own. It seems to us that there is also a strong
public policy favoring early certainty as to the location of land ownership which
enters into a proper interpretation of privity.
On the irregular perimeters of Puget Sound exact determination of land
locations and boundaries is difficult and expensive. This difficulty is convinc-
ingly demonstrated in this case by the problems plaintiff’s engineer encoun-
tered in attempting to locate the corners. It cannot be expected that every
purchaser will or should engage a surveyor to ascertain that the beach home he
is purchasing lies within the boundaries described in his deed. Such a practice
is neither reasonable nor customary. Of course, 50-foot errors in descriptions
are devastating where a group of adjacent owners each hold 50 feet of water-
front property.
The technical requirement of “privity” should not, we think, be used to upset
the long periods of occupancy of those who in good faith received an erroneous
deed description. Their “claim of right” is no less persuasive than the purchaser
who believes he is purchasing more land than his deed described.

26. In Baylor v. Soska, 658 A.2d 743 (Pa. 1995), the court held that tacking is not permitted unless the
disputed parcel is actually described by the deed as the land conveyed. This view would prevent tacking in
Howard v. Kunto. Which view is better? — Eds.
27. The English common law does not require privity as a prerequisite for tacking. See F. Clark, Law of
Surveying and Boundaries, § 561 (3d ed. 1959) at 568.
100

In the final analysis, however, we believe the requirement of “privity” is no


more than judicial recognition of the need for some reasonable connection
between successive occupants of real property so as to raise their claim of right
above the status of the wrongdoer or the trespasser. We think such reasonable
connection exists in this case.
Where, as here, several successive purchasers received record title to tract A
under the mistaken belief that they were acquiring tract B, immediately contigu-
ous thereto, and where possession of tract B is transferred and occupied in a con-
tinuous manner for more than 10 years by successive occupants, we hold there is
sufficient privity of estate to permit tacking and thus establish adverse possession
as a matter of law.
We see no reason in law or in equity for differentiating this case from
Faubion v. Elder, 49 Wash. 2d 300, 301 P.2d 153 (1956), where the appellants
were claiming more land than their deed described and where successive periods
of occupation were allowed to be united to each other to make up the time of
adverse holding. . . .
This application of the privity requirement should particularly pertain
where the holder of record title to tract B acquired the same with knowledge of
the discrepancy.
Judgment is reversed with directions to dismiss plaintiffs’ action and to enter
a decree quieting defendants’ title to the disputed tract of land in accordance
with the prayer of their cross-complaint.

QUESTIONS

1. In Mannillo (page 89), the court held that an adverse occupation might
be so small as to not be open and notorious. Was there not a related but unad-
dressed problem in Howard v. Kunto? Consider the observation of Robert M.
Pirsig in his book Zen and the Art of Motorcycle Maintenance 48 (1974): “Some
things you miss because they’re so tiny you overlook them. But some things you
don’t see because they’re so huge.”
2. Suppose that instead of building a summer house on “their” lot, the
Kuntos and their predecessors had camped every summer on the lot and, being
good environmentalists, had left no traces when they removed their camp in the
fall. Would this satisfy the requirement of continuity? Compare Ray v. Beacon
Hudson Mountain Corp., 666 N.E.2d 532 (N.Y. 1996).
For an argument that adverse possession rules favor economic exploitation
of wild lands by permitting successful claims of adverse possession of wild lands
to rest on limited, sporadic activities that would not be sufficient for developed
lands, see John G. Sprankling, An Environmental Critique of Adverse Possession,
79 Cornell L. Rev. 816 (1994). Inasmuch as strengthening the standard for
adverse possession of wild lands might result in claimants inflicting more envi-
ronmental injury, Professor Sprankling suggests exempting wild lands altogether
from adverse possession. See also Alexandra B. Klass, Adverse Possession and
Conservation: Expanding Traditional Notions of Use and Possession, 77 Colo.
U. L. Rev. 283 (2006).
101

PROBLEMS: TACKING

An important issue in Howard v. Kunto concerns so-called tacking and the


requirement of privity among a series of adverse possessors. But tacking comes
into play in different guises. Suppose, for example, that X buys certain property
described in a deed from the seller, who as it happens had also (but unknowingly)
adversely possessed a strip adjacent to the described land. If the evidence shows
that the deed to X was intended by the parties to convey not only the described
land but also the adversely possessed strip, is X allowed to “tack” that strip onto
the land described in the deed? In Buchanan v. Cassell, cited in Howard v. Kunto
at page 98, the court held that X could do exactly that. Howard v. Kunto, rely-
ing on the clear intentions of the parties in privity with one another, extends
Buchanan to a situation where the deed describes none of the land in question,
such that there is nothing onto which the adversely possessed land can be tacked.
Another kind of tacking issue arises when land is adversely possessed by a series
of people, no one of whom occupies the land for the statutory period, though all of
them taken together do. May the bits of time of each possessor be tacked together?
Is privity required? The following problems explore these matters, as well as the
related situation when adverse possession is asserted against a series of owners.
Assume in each problem that the jurisdiction has a 10-year statute of limitations.
1. In 2000 A enters adversely upon Blackacre,28 owned by O. In 2007 B tells
A, “Get out of here, I’m taking over.” A, feeling threatened, leaves, and B enters
into possession. In 2010 who owns Blackacre? Can O or A eject B ? See 3 American
Law of Property § 15.10 (1952). For the contrary English law, see footnote 27 and
Robert Megarry & H.W.R. Wade, Real Property 1422-1423 (Charles Harpum 7th
ed. 2008) (“time runs against the true owner from the time when adverse pos-
session began, and so long as adverse possession continues unbroken it makes
no difference who continues it”). Which view is better? To what extent does your
answer turn on what you see as the purposes of adverse possession?
Suppose that in 2007 A leaves under threat of force, but six months later A
recovers possession from B. If O does nothing, will A own Blackacre 10 years from
the date of his entry in 2000, or 10 years and six months from the date of his entry
in 2000, or in 2017? See 3 American Law of Property, supra, § 15.10.
Suppose that in 2007 A abandons Blackacre, and B immediately goes into
possession. If O does nothing, will B own Blackacre in 2010?
2. In 1994 A enters adversely upon Blackacre, owned by O. In 1995 O dies,
leaving a will that devises Blackacre to B for life, remainder to C. In 2010 B dies
without ever having entered upon Blackacre. Who owns Blackacre?
3. O, owner of Blackacre, dies in 1995 leaving a will that devises Blackacre
to B for life, remainder to C. In 1996 A enters adversely upon the land. In 2010 B
dies. Who owns Blackacre? See 3 American Law of Property, supra, § 15.8; Harper

28. Hypothetical tracts of land traditionally have been referred to as Blackacre, Whiteacre, and
Greenacre — just why no one knows for sure. One of the earliest law treatises written in English, Coke on
Littleton 148b (1628), refers to Blackacre and Whiteacre. The Oxford English Dictionary suggests the terms
indicate lands growing different crops (peas and beans are black, corn and potatoes are white, hay is green). Or
the terms might originally have referred to lands receiving different rents (black rents are payable in produce,
white rents in silver). Students have sometimes suggested that Wiseacre be added to the list.
102

v. Paradise, 210 S.E.2d 710 (Ga. 1974), reproduced at page 702; Piel v. Dewitt, 351
N.E.2d 48 (Ind. App. 1976). But cf. Wallace v. Magie, 522 P.2d 989 (Kan. 1974).

PROBLEMS: DISABILITIES

In every state, the statute of limitations is extended if specified disabilities


are present. Disability provisions differ, but the following example is typical:

An action to recover the title to or possession of real property shall be brought


within ten years after the cause thereof accrued, but if a person entitled to bring
such action, at the time the cause thereof accrues, is within the age of minority, of
unsound mind, or imprisoned, such person, after the expiration of ten years from
the time the cause of action accrues, may bring such action within five years after
such disability is removed.

Particularly note two matters: A disability is immaterial unless it existed at


the time when the cause of action accrued. And after the words “such person”
you should insert, as a result of judicial construction, the words “or anyone claim-
ing from, by, or under such person.” (Do you see why a court would read those
words into the statute?)
When in the following examples would the adverse possessor acquire title
under the statute set out above? In each case, O is the owner in 1995, and A enters
adversely on May 1, 1995. The age of majority is 18. (In reading the examples,
understand that to die “intestate” means to die without a will. In such cases, the
decedent’s estate goes to heirs, if the decedent has any.)
1. O is insane in 1995. O dies insane and intestate in 2008.
(a) O’s heir, H, is under no disability in 2008.
(b) O’s heir, H, is six years old in 2008.
2. O has no disability in 1995. O dies intestate in 2004. O’s heir, H, is two
years old in 2004.
3. O is eight years old in 1995. In 2002 O becomes mentally ill, and O dies
intestate in 2011. O’s heir, H, is under no disability. Does the adverse possessor
here acquire title in 2005, 2010, or at some later date? If the answer is 2005 or
2010, how are O’s interests to be protected?
Consider again the purposes of adverse possession and note how some of
them conflict in the case of disabilities. Does reflection on Problem 3 suggest that
disability doctrine is unnecessary?
4. O disappears in 1998 and is not heard from again. You represent B, who
wishes to buy from A. What advice do you give B?

NOTE: ADVERSE POSSESSION AGAINST


THE GOVERNMENT

Under the common law rules, adverse possession does not run against
the government — local, state, or federal. In England, the maxim nullum tempus
103

occurrit regi (no time runs against the king) barred the running of the statute of
limitations against the sovereign. In barring adverse possession against the gov-
ernment, American courts have relied on this rule as well as state constitutional
provisions restricting the alienation of state lands. Courts often say, in justifica-
tion, that the state owns its land in trust for all the people, who should not lose
the land because of the negligence of a few state officers or employees.
A number of states, however, have changed the common law rules, whether
by legislation or judge-made law.29 A few permit adverse possession against gov-
ernment land on the same terms as against private land. Others permit it only if
possession continues for a period much longer than that applied in the case of
private lands. Still others permit it only against government lands held in a pro-
prietary (as opposed to a public or governmental) capacity. See, e.g., American
Trading Real Estate Properties, Inc. v. Town of Trumbull, 574 A.2d 796 (Conn.
1990); Devins v. Borough of Bogota, 592 A.2d 199 (N.J. 1991).
Are there good reasons to treat government lands differently from those
privately owned? What types of land might justifiably be subjected to adverse pos-
session and what types not?

3. Adverse Possession of Chattels

O’Keeffe v. Snyder
Supreme Court of New Jersey, 1980
416 A.2d 862

Pollock, J. This is an appeal from an order of the Appellate Division granting


summary judgment to plaintiff, Georgia O’Keeffe, against defendant, Barry
Snyder, d/b/a Princeton Gallery of Fine Arts, for replevin of three small pictures
painted by O’Keeffe. In her complaint, filed in March, 1976, O’Keeffe alleged
she was the owner of the paintings and that they were stolen from a New York art
gallery in 1946. Snyder asserted he was a purchaser for value of the paintings, he
had title by adverse possession, and O’Keeffe’s action was barred by the expira-
tion of the six-year period of limitations . . . pertaining to an action in replevin.
Snyder impleaded third party defendant, Ulrich A. Frank, from whom Snyder
purchased the paintings in 1975 for $35,000.
The trial court granted summary judgment for Snyder on the ground that
O’Keeffe’s action was barred because it was not commenced within six years of
the alleged theft. The Appellate Division reversed and entered judgment for
O’Keeffe. A majority of that court concluded that the paintings were stolen, the
defenses of expiration of the statute of limitations and title by adverse possession
were identical, and Snyder had not proved the elements of adverse possession.

29. Even absent such changes, the government may be estopped from asserting any right to land where a
person improves the land with the knowledge and acquiescence of government officials. See, e.g., Clinton Natl.
Bank v. City of Camanche, 251 N.W.2d 248 (Iowa 1977).
104

Consequently, the majority ruled that O’Keeffe could still enforce her right to
possession of the paintings.
. . . We reverse and remand the matter for a plenary hearing in accordance
with this opinion.
The record, limited to pleadings, affidavits, answers to interrogatories, and
depositions, is fraught with factual conflict. Apart from the creation of the paint-
ings by O’Keeffe and their discovery in Snyder’s gallery in 1976, the parties agree
on little else.
O’Keeffe contended the paintings were stolen in 1946 from a gallery, An
American Place. The gallery was operated by her late husband, the famous pho-
tographer Alfred Stieglitz.
An American Place was a cooperative undertaking of O’Keeffe and some other
American artists identified by her as Marin, Hardin, Dove, Andema, and Stevens. In
1946, Stieglitz arranged an exhibit which included an O’Keeffe painting, identified
as Cliffs. According to O’Keeffe, one day in March, 1946, she and Stieglitz discov-
ered Cliffs was missing from the wall of the exhibit. O’Keeffe estimates the value of
the painting at the time of the alleged theft to have been about $150.
About two weeks later, O’Keeffe noticed that two other paintings, Seaweed
and Fragments, were missing from a storage room at An American Place. She did
not tell anyone, even Stieglitz, about the missing paintings, since she did not want
to upset him.
Before the date when O’Keeffe discovered the disappearance of Seaweed,
she had already sold it (apparently for a string of amber beads) to a Mrs. Weiner,
now deceased. Following the grant of the motion for summary judgment by the
trial court in favor of Snyder, O’Keeffe submitted a release from the legatees of
Mrs. Weiner purportedly assigning to O’Keeffe their interest in the sale.
O’Keeffe testified on depositions that at about the same time as the disap-
pearance of her paintings, 12 or 13 miniature paintings by Marin also were stolen
from An American Place. According to O’Keeffe, a man named Estrick took the
Marin paintings and “maybe a few other things.” Estrick distributed the Marin
paintings to members of the theater world who, when confronted by Stieglitz,
returned them. However, neither Stieglitz nor O’Keeffe confronted Estrick with
the loss of any of the O’Keeffe paintings.
There was no evidence of a break and entry at An American Place on the
dates when O’Keeffe discovered the disappearance of her paintings. Neither
Stieglitz nor O’Keeffe reported them missing to the New York Police Department
or any other law enforcement agency. Apparently the paintings were uninsured,
and O’Keeffe did not seek reimbursement from an insurance company. Similarly,
neither O’Keeffe nor Stieglitz advertised the loss of the paintings in Art News or
any other publication. Nonetheless, they discussed it with associates in the art
world and later O’Keeffe mentioned the loss to the director of the Art Institute of
Chicago, but she did not ask him to do anything because “it wouldn’t have been
my way.” O’Keeffe does not contend that Frank or Snyder had actual knowledge
of the alleged theft.
Stieglitz died in the summer of 1946, and O’Keeffe explains she did not pur-
sue her efforts to locate the paintings because she was settling his estate. In 1947,
she retained the services of Doris Bry to help settle the estate. Bry urged O’Keeffe
105

to report the loss of the paintings, but O’Keeffe declined because “they never got
anything back by reporting it.” Finally, in 1972, O’Keeffe authorized Bry to report
the theft to the Art Dealers Association of America, Inc., which maintains for its
members a registry of stolen paintings. The record does not indicate whether
such a registry existed at the time the paintings disappeared.
In September, 1975, O’Keeffe learned that the paintings were in the Andrew
Crispo Gallery in New York on consignment from Bernard Danenberg Galleries.
On February 11, 1976, O’Keeffe discovered that Ulrich A. Frank had sold the
paintings to Barry Snyder, d/b/a Princeton Gallery of Fine Art. She demanded
their return and, following Snyder’s refusal, instituted this action for replevin.
Frank traces his possession of the paintings to his father, Dr. Frank, who died
in 1968. He claims there is a family relationship by marriage between his family
and the Stieglitz family, a contention that O’Keeffe disputes. Frank does not know
how his father acquired the paintings, but he recalls seeing them in his father’s
apartment in New Hampshire as early as 1941-1943, a period that precedes the
alleged theft. Consequently, Frank’s factual contentions are inconsistent with
O’Keeffe’s allegation of theft. Until 1965, Dr. Frank occasionally lent the paint-
ings to Ulrich Frank. In 1965, Dr. and Mrs. Frank formally gave the paintings
to Ulrich Frank, who kept them in his residences in Yardley, Pennsylvania and
Princeton, New Jersey. In 1968, he exhibited anonymously Cliffs and Fragments
in a one day art show in the Jewish Community Center in Trenton. All of these
events precede O’Keeffe’s listing of the paintings as stolen with the Art Dealers
Association of America, Inc. in 1972.
Frank claims continuous possession of the paintings through his father for
over thirty years and admits selling the paintings to Snyder. Snyder and Frank
do not trace their provenance, or history of possession of the paintings, back to
O’Keeffe.
As indicated, Snyder moved for summary judgment on the theory that
O’Keeffe’s action was barred by the statute of limitations and title had vested in
Frank by adverse possession. For purposes of his motion, Snyder conceded that
the paintings had been stolen. On her cross motion, O’Keeffe urged that the
paintings were stolen, the statute of limitations had not run, and title to the paint-
ings remained in her. . . .
The Appellate Division accepted O’Keeffe’s contention that the paintings
had been stolen. However, in his deposition, Ulrich Frank traces possession of the
paintings to his father in the early 1940s, a date that precedes the alleged theft
by several years. The factual dispute about the loss of the paintings by O’Keeffe
and their acquisition by Frank, as well as the other subsequently described factual
issues, warrant a remand for a plenary hearing. . . .
Without purporting to limit the scope of the trial, other factual issues include
whether .  .  . the paintings were not stolen but sold, lent, consigned, or given
by Stieglitz to Dr. Frank or someone else without O’Keeffe’s knowledge before
he died; and [whether] there was any business or family relationship between
Stieglitz and Dr. Frank so that the original possession of the paintings by the
Frank family may have been under claim of right.
On the limited record before us, we cannot determine now who has title to
the paintings. The determination will depend on the evidence adduced at trial.
106

Seaweed (1926)
Georgia O’Keeffe
Copyright © 2017 Georgia O’Keeffe Museum
Artists Rights Society (ARS), New York

Nonetheless, we believe it may aid the trial court and the parties to resolve ques-
tions of law that may become relevant at trial.
Our discussion begins with the principle that, generally speaking, if the
paintings were stolen, the thief acquired no title and could not transfer good
title to others regardless of their good faith and ignorance of the theft. Proof of
theft would advance O’Keeffe’s right to possession of the paintings absent other
considerations such as expiration of the statute of limitations.
Another issue that may become relevant at trial is whether Frank or his
father acquired a “voidable title” to the paintings under N.J.S.A. 12A:2-403(1).
That section, part of the Uniform Commercial Code (U.C.C.),30 does not change

30. Uniform Commercial Code § 2-403 provides:


§ 2-403. Power to Transfer; Good Faith Purchase of Goods; “Entrusting.”
(1) A purchaser of goods acquires all title which his transferor had or had power to transfer except
that a purchaser of a limited interest acquires rights only to the extent of the interest purchased. A per-
son with voidable title has power to transfer a good title to a good faith purchaser for value. When goods
have been delivered under a transaction of purchase the purchaser has such power even though
(a) the transferor was deceived as to the identity of the purchaser, or
107

the basic principle that a mere possessor cannot transfer good title. Nonetheless,
the U.C.C. permits a person with voidable title to transfer good title to a good
faith purchaser for value in certain circumstances. If the facts developed at trial
merit application of that section, then Frank may have transferred good title to
Snyder, thereby providing a defense to O’Keeffe’s action. . . .
On this appeal, the critical legal question is when O’Keeffe’s cause of action
accrued. The fulcrum on which the outcome turns is the statute of limitations
. . . , which provides that an action for replevin of goods or chattels must be com-
menced within six years after the accrual of the cause of action.
The trial court found that O’Keeffe’s cause of action accrued on the date
of the alleged theft, March, 1946, and concluded that her action was barred.
The Appellate Division found that an action might have accrued more than six
years before the date of suit if possession by the defendant or his predecessors
satisfied the elements of adverse possession. As indicated, the Appellate Division
concluded that Snyder had not established those elements and that the O’Keeffe
action was not barred by the statute of limitations. . . .
The purpose of a statute of limitations is to “stimulate to activity and pun-
ish negligence” and “promote repose by giving security and stability to human
affairs.” Wood v. Carpenter, 101 U.S. 135, 139, 25 L. Ed. 807, 808 (1879). A statute
of limitations achieves those purposes by barring a cause of action after the statu-
tory period. In certain instances, this Court has ruled that the literal language of
a statute of limitations should yield to other considerations.
To avoid harsh results from the mechanical application of the statute, the
courts have developed a concept known as the discovery rule. The discovery rule
provides that, in an appropriate case, a cause of action will not accrue until the
injured party discovers, or by exercise of reasonable diligence and intelligence
should have discovered, facts which form the basis of a cause of action. The rule is
essentially a principle of equity, the purpose of which is to mitigate unjust results
that otherwise might flow from strict adherence to a rule of law. . . .
[W]e conclude that the discovery rule applies to an action for replevin of a
painting. . . . O’Keeffe’s cause of action accrued when she first knew, or reason-
ably should have known through the exercise of due diligence, of the cause of
action, including the identity of the possessor of the paintings. . . .
In determining whether O’Keeffe is entitled to the benefit of the discov-
ery rule, the trial court should consider, among others, the following issues: (1)
whether O’Keeffe used due diligence to recover the paintings at the time of the
alleged theft and thereafter; (2) whether at the time of the alleged theft there
was an effective method, other than talking to her colleagues, for O’Keeffe to
alert the art world; and (3) whether registering paintings with the Art Dealers

(b) the delivery was in exchange for a check which was later dishonored, or
(c) it was agreed that the transaction was to be a “cash sale,” or
(d) the delivery was procured through fraud punishable as larcenous under the criminal law.
(2) Any entrusting of possession of goods to a merchant who deals in goods of that kind gives him
power to transfer all rights of the entruster to a buyer in the ordinary course of business.
(3) “Entrusting” includes any delivery and any acquiescence in retention of possession regardless of
any condition expressed between the parties to the delivery or acquiescence and regardless of whether
the procurement of the entrusting or the possessor’s disposition of the goods have been such as to be
larcenous under the criminal law. — Eds.
108

Association of America, Inc. or any other organization would put a reasonably


prudent purchaser of art on constructive notice that someone other than the
possessor was the true owner.
The acquisition of title to real and personal property by adverse possession
is based on the expiration of a statute of limitations. . . .
To establish title by adverse possession to chattels, the rule of law has been
that the possession must be hostile, actual, visible, exclusive, and continuous. . . .
There is an inherent problem with many kinds of personal property that will raise
questions whether their possession has been open, visible, and notorious. . . . For
example, if jewelry is stolen from a municipality in one county in New Jersey, it is
unlikely that the owner would learn that someone is openly wearing that jewelry
in another county or even in the same municipality. Open and visible possession
of personal property, such as jewelry, may not be sufficient to put the original
owner on actual or constructive notice of the identity of the possessor.
The problem is even more acute with works of art. Like many kinds of per-
sonal property, works of art are readily moved and easily concealed. O’Keeffe
argues that nothing short of public display should be sufficient to alert the true
owner and start the statute running. Although there is merit in that contention
from the perspective of the original owner, the effect is to impose a heavy burden
on the purchasers of paintings who wish to enjoy the paintings in the privacy of
their homes. . . .
The problem is serious. According to an affidavit submitted in this matter by
the president of the International Foundation for Art Research, there has been
an “explosion in art thefts” and there is a “worldwide phenomenon of art theft
which has reached epidemic proportions.”
The limited record before us provides a brief glimpse into the arcane world
of sales of art, where paintings worth vast sums of money sometimes are bought
without inquiry about their provenance. There does not appear to be a reason-
ably available method for an owner of art to record the ownership or theft of
paintings. Similarly, there are no reasonable means readily available to a pur-
chaser to ascertain the provenance of a painting. It may be time for the art world
to establish a means by which a good faith purchaser may reasonably obtain the
provenance of a painting. An efficient registry of original works of art might bet-
ter serve the interests of artists, owners of art, and bona fide purchasers than
the law of adverse possession with all of its uncertainties. Although we cannot
mandate the initiation of a registration system, we can develop a rule for the com-
mencement and running of the statute of limitations that is more responsive to
the needs of the art world than the doctrine of adverse possession.
We are persuaded that the introduction of equitable considerations through
the discovery rule provides a more satisfactory response than the doctrine of
adverse possession. The discovery rule shifts the emphasis from the conduct of
the possessor to the conduct of the owner. The focus of the inquiry will no longer
be whether the possessor has met the tests of adverse possession, but whether the
owner has acted with due diligence in pursuing his or her personal property.
For example, under the discovery rule, if an artist diligently seeks the recov-
ery of a lost or stolen painting, but cannot find it or discover the identity of the
possessor, the statute of limitations will not begin to run. The rule permits an
110

theory of adverse possession, has been not only to bar an action for possession, but
also to vest title in the possessor. There is no reason to change that result although
the discovery rule has replaced adverse possession. History, reason, and common
sense support the conclusion that the expiration of the statute of limitations bars
the remedy to recover possession and also vests title in the possessor. . . . Before
the expiration of the statute, the possessor has both the chattel and the right to
keep it except as against the true owner. The only imperfection in the possessor’s
right to retain the chattel is the original owner’s right to repossess it. Once that
imperfection is removed, the possessor should have good title for all purposes. . . .
We next consider the effect of transfers of a chattel from one possessor to
another during the period of limitation under the discovery rule. Under the dis-
covery rule, the statute of limitations on an action for replevin begins to run
when the owner knows or reasonably should know of his cause of action and the
identity of the possessor of the chattel. Subsequent transfers of the chattel are
part of the continuous dispossession of the chattel from the original owner. The
important point is not that there has been a substitution of possessors, but that
there has been a continuous dispossession of the former owner. . . .
For the purpose of evaluating the due diligence of an owner, the dispos-
session of his chattel is a continuum not susceptible to separation into distinct
acts. Nonetheless, subsequent transfers of the chattel may affect the degree of
difficulty encountered by a diligent owner seeking to recover his goods. To that
extent, subsequent transfers and their potential for frustrating diligence are
relevant in applying the discovery rule. An owner who diligently seeks his chat-
tel should be entitled to the benefit of the discovery rule although it may have
passed through many hands. Conversely an owner who sleeps on his rights may
be denied the benefit of the discovery rule although the chattel may have been
possessed by only one person.
We reject the alternative of treating subsequent transfers of a chattel as sepa-
rate acts of conversion that would start the statute of limitations running anew.
At common law, apart from the statute of limitations, a subsequent transfer of a
converted chattel was considered to be a separate act of conversion. . . . Adoption
of that alternative would tend to undermine the purpose of the statute in quiet-
ing titles and protecting against stale claims.
The majority and better view is to permit tacking, the accumulation of con-
secutive periods of possession by parties in privity with each other. . . .
We reverse the judgment of the Appellate Division in favor of O’Keeffe and
remand the matter for trial in accordance with this opinion.
[Dissenting opinions by Justice Sullivan and Justice Handler are omitted.]

POSTSCRIPT
The parties in O’Keeffe v. Snyder subsequently settled before a retrial. The
paintings were divided. O’Keeffe took “Seaweed,” Snyder took another painting,
and the third was sold at auction at Sotheby’s to pay lawyers’ bills.
111

A NOTE ON GEORGIA O’KEEFFE

Georgia O’Keeffe, born on a dairy farm in 1887 in Sun Prairie, Wisconsin,


grew up in the rural Midwest. After studying art under various teachers in Chicago
and New York, she decided to paint shapes that, she claimed, were “in [her]
head.” In 1915, she sent some of her drawings — of budding and organic shapes,
reflecting an intense feminine sensibility — to a friend in New York, admonishing
her to show them to no one. The friend, disregarding O’Keeffe’s wishes, showed
them to Alfred Stieglitz, the noted New York photographer and gallery owner.
Upon seeing the drawings, Stieglitz remarked, “At last, a woman on paper,” and
promptly displayed them in his gallery. When, shortly thereafter, O’Keeffe came
to New York and learned of this, she was furious. She rushed to the gallery and
demanded that her private work, shown without her permission, be taken down.
Stieglitz refused. To keep her work from being seen, he told her, would be like
depriving the world of a child about to be born (with Stieglitz as midwife). The
drawings remained on the wall, provoking much controversy about O’Keeffe’s
sexual symbolism, which she denied was there.
Stieglitz, obsessed with this woman 20 years his junior, soon left his wife
and daughter and moved in with her. “He photographed me until I was crazy,”
O’Keeffe — with a mischievous chuckle — recalled in her nineties. He photo-
graphed every square inch of O’Keeffe nude, then exhibited the pictures in a
show, creating a scandal and bringing O’Keeffe instant fame.
Soon thereafter, O’Keeffe began to produce many of her spectacular flower
paintings, which critics once again found full of Freudian symbolism. O’Keeffe
replied to them:

Well — I made you take time to look at what I saw and when you took time to
really notice my flower you hung all your own associations with flowers on my flower
and you write about my flower as if I think and see what you think and see of the
flower — and I don’t.31

O’Keeffe, now established in the New York art world, became the embodi-
ment of Stieglitz’s belief that women could turn out art as powerful as any man’s.
O’Keeffe and Stieglitz married in 1924. When, a few years later, Stieglitz
entered into a liaison with a woman half O’Keeffe’s age, and put her in charge of
his gallery, O’Keeffe — needing space — began spending long summers in New
Mexico. She found that New Mexico was where she belonged, but she could not
leave Stieglitz, to whom she remained intensely devoted. She returned to New
York every fall to renew her bond with him, though she never answered amiably
when addressed as “Mrs. Stieglitz.”
When Stieglitz died in 1946, at age 82, O’Keeffe first booted his lover out
of his gallery, and then she moved to New Mexico for good. In the isolated
Penitente village of Abiquiu (pop. 150), on a rise overlooking the green Chama
River valley and barren pink and white and ochre hills beyond, she had many

31. Or O’Keeffe might have replied — as Freud, who loved cigars, is reputed to have said — “Sometimes
a cigar is just a cigar.”
112

Georgia O’Keeffe, 1968


© Arnold Newman/Getty Images

years before found a roofless adobe building with a door she “just had to paint”
and had to own. Now, after lengthy negotiations, including long afternoon vis-
its by the priests, O’Keeffe was able to wrest title away from the local Catholic
church. O’Keeffe fixed up the adobe, fitted it with Zenlike simplicity, walled it in
with a garden and orchard, and lived there, mostly alone, with some chow dogs
she described as “good biters,” until her death in 1986 at age 99. She left most of
her estate of $70 million (comprised largely of 400 works of art she had created)
to a handsome young man by the name of Juan Hamilton, who, when O’Keeffe
was 86, knocked on her door at Abiquiu looking for work. Hamilton bore an
uncanny resemblance to the youthful Stieglitz. He moved in with O’Keeffe soon
after being admitted at her door, becoming her indispensable companion and,
some say, lover. When her old friend of many years, the mother of Harvard’s
former president Derek Bok, called Hamilton a fortune hunter, O’Keeffe icily
rebuffed her and cut Harvard out of her will.

NOTES AND QUESTIONS

1. Note that the opinion in O’Keeffe permits tacking of periods of possession,


but — it appears — only so long as the possessors are in privity with each other.
See page 110. Given the focus in O’Keeffe on the conduct of the owner, and given
that the “important point is not that there has been a substitution of possessors,
but that there has been a continuous dispossession of the former owner,” why is
privity required?
For an analysis of O’Keeffe v. Snyder, see Paula A. Franzese, “Georgia on My
Mind” — Reflections on O’Keeffe v. Snyder, 9 Seton Hall L. Rev. 1, 14-15 (1989).
113

2. At least one state, California, has adopted the discovery rule by statute.
See Cal. Civ. Proc. Code §338(c) (West 2013) But New York, probably the site
of most purchases of major works of art in the United States, has rejected it on
the ground that it provides insufficient protection for owners of stolen artwork.
See Solomon R. Guggenheim Found. v. Lubell, 569 N.E.2d 426 (N.Y. 1991). The
Guggenheim case held that the statute of limitations for replevin does not begin to
run in favor of a good-faith purchaser until the true owner makes a demand for
return and the good-faith purchaser refuses. Until demand is made, possession of
the stolen property by a good-faith purchaser for value is not considered wrong-
ful. The court thought it inappropriate to put a duty of reasonable diligence on
the true owner, reasoning that such an approach would encourage illicit traffick-
ing in stolen art by putting the burden on the true owner to demonstrate that it
had undertaken a reasonable search. Moreover, the court believed that it would
be difficult, if not impossible, to craft a reasonable diligence requirement that
could take into account all the variables in a particular situation and not unduly
burden the true owner. The better rule, the court said, is to protect true own-
ers by requiring potential purchasers to investigate the provenance of works of
art. The true owner’s diligence remains relevant, however, in that unreasonable
delay, if it works to the prejudice of the good-faith purchaser, might permit the
latter to assert the equitable defense of laches.
3. Purchasing from a thief: conflicting views. In the United States (and adverse
possession aside), a purchaser cannot obtain good title from a thief — a point
implicit in the first sentence of subsection (1) of Uniform Commercial Code
§ 2-403, set out in footnote 30 on page 106. Notice, however, that a purchaser
might be able to obtain good title from other sorts of scoundrels, as the court
in O’Keeffe suggests on pages 105-107. If Frank had a “voidable title” for one of
the reasons suggested in subsections (a) through (d) of the Code provision (for
example, paying for the paintings by a check that bounced), then Frank could
convey good title to Snyder if Snyder was “a good faith purchaser for value,”
meaning, essentially, a buyer not on notice that matters are amiss. If O’Keeffe
had entrusted the paintings to Stieglitz’s gallery for appraisal but not for sale,
Stieglitz — being “a merchant who deals in goods of that kind” — could transfer
a good title to a good-faith buyer in the ordinary course of business. See U.C.C.
§ 2-403(2).
Some countries in Europe and elsewhere follow similar rules, but not all
of them do. Several recognize the doctrine of market overt, according to which
a bona fide purchaser may acquire good title from a thief if the sale in ques-
tion takes place in an open market. Opportunities for the laundering of stolen
objects arise as a result. The problem has not gone unnoticed in the art world
(nor, we presume, the underworld). See, e.g., Note, International Transfers of
Stolen Cultural Property: Should Thieves Continue to Benefit from Domestic
Laws Favoring Bona Fide Purchasers?, 13 Loy. L.A. Intl. & Comp. L.J. 427 (1990).
Whom should the law protect in instances like those discussed, the innocent
owner or the innocent bona fide purchaser? What interests are in conflict? Does
reflection on the voidable-title and entrusting exceptions contained in Uniform
Commercial Code § 2-403 suggest a way to resolve the conflict? See Robert Cooter
& Thomas Ulen, Law and Economics 159-161 (5th ed. 2008).
114

C. Acquisition by Gift

To complete our study of possession, we turn to gifts of personal property, where,


as we shall see, possession plays a very important role. There are three require-
ments to make a gift of personal property. First, the donor must intend to make a
present transfer of an existing interest in the property. Intent is commonly a prob-
lem in litigated gift cases. Second, the donor must deliver possession (“hand over
the property”) to the donee with the manifested intention to make a gift. Delivery
and intent interact and overlap with each other to a considerable degree, but
they are discrete requirements nonetheless, and both must be present. Finally,
acceptance by the donee is also required but seldom an issue. Courts presume
acceptance upon delivery, unless a donee expressly refuses a gift. Intention to
make a gift may be shown by oral evidence; delivery requires objective acts.
More on delivery. The requirement of transfer of possession is feudal in ori-
gin. In feudal times, when few could read or write, a symbolic ceremony trans-
ferring possession was an important ritual signifying the transfer. Land could be
transferred only by delivering a clod of dirt or a branch to the grantee on the land
itself. The ceremony was called “livery of seisin” (see page 282); chattels had to be
handed over. In 1677 the Statute of Frauds abolished livery of seisin and initiated
the requirement of a deed to pass title to land. However, the visual ceremony of
transferring possession still survives if the object transferred is on top of the land.
In a famous article, Professor Mechem suggested the following reasons for the
survival of the delivery requirement in gifts of personal property:

1. Handing over the object makes vivid and concrete to the donor the signifi-
cance of the act performed. By feeling the “wrench of delivery,” the donor realizes
an irrevocable gift has been made.
2. The act is unequivocal evidence of a gift to the actual witnesses of the
transaction.
3. Delivery of the object to the donee gives the donee, after the act, prima
facie evidence in favor of the alleged gift. [Philip Mechem, Gifts of Chattels and of
Choses in Action Evidenced by Commercial Instruments, 21 Ill. L. Rev. 341, 348-349
(1926).]

If manual delivery is not practicable because of the size or weight of the object, or
its inaccessibility, constructive or symbolic delivery may be permitted. Constructive
delivery is handing over a key or some object that will open up access to the sub-
ject matter of the gift. Symbolic delivery is handing over something symbolic of
the property given. The usual case of symbolic delivery involves handing over a
written instrument declaring a gift of the subject matter; for example, Joe hands
to Marilyn a paper reading, “I give my grand piano to Marilyn. s/ Joe.” The tra-
ditional rule of gifts is: If an object can be handed over, it must be. But there are
indications that the rule is eroding. For example, one court found valid construc-
tive delivery where a donor who had received a check from another endorsed the
check in blank and put it on a table in her apartment, which she shared with the
donee, along with a note giving the check to the donee, and then left with the
115

intention of committing suicide (which she did). Scherer v. Hyland, 380 A.2d
698 (N.J. 1977). Under the traditional rule, constructive delivery would not be
recognized here. (Do you see why?) However, the court stated that it would find a
constructive delivery adequate “when the evidence of donative intent is concrete
and undisputed, when there is every indication that the donor intended to make
a present transfer of the subject-matter of the gift, and when the steps taken by
the donor to effect such a transfer must have been deemed by the donor as suf-
ficient to pass the donor’s interest to the donee.”
The restriction on symbolic delivery has also been relaxed somewhat. Some
states have statutes providing that symbolic delivery by a writing is always permit-
ted. E.g., Cal. Civ. Code §1147 (West 2013).
With only three requirements, gift law is beguilingly simple, and we shall
see that the requirements of donative intent and delivery are far more complex
than meets the eye. In studying the materials that follow, it will be helpful to keep
in mind this observation from a recent commentator: “[A] close examination of
the cases leaves a reader with a sense that ad hoc considerations of fairness and
justice or propriety do much of the work in leading judges to decisions.” Roy
Kreitner, The Gift Beyond the Grave: Revising the Question of Consideration,
101 Colum. L. Rev. 1876, 1906 (2001).

PROBLEMS

1. O owns a pearl ring. While visiting her daughter A, O leaves the ring on
the bathroom sink. After O leaves, A discovers the ring. When A telephones O to
tell her of the discovery, O tells A to keep the ring as a gift. Has O made a gift to
A? If so, can O change her mind the next day and require A to return the ring?
Suppose that A does not telephone O to tell her the ring has been found. A
week later, at a dinner with friends, A surprises O by producing the ring. O takes
the ring, looks at it, then gives it back to A, saying, “I want you to have it. It’s
yours.” A tries the ring on, but it is too large for A’s finger. O then says, “Let me
wear it until you can get it cut down to fit you.” O leaves the dinner wearing the
ring, is struck by a car, and is killed. A sues O’s executor for the ring. What result?
Garrison v. Union Trust Co., 129 N.W. 691 (Mich. 1910).
Suppose that at the dinner above, O had not said the words quoted, but
instead had said, “I promise to leave you this ring when I die.” What result? For
criticism of the distinction between gifts and gift promises, see Jane B. Baron,
Gifts, Bargains, and Form, 64 Ind. L.J. 155 (1989). The traditional rule that
gift promises are legally unenforceable for lack of consideration is defended in
Melvin Eisenberg, The World of Contract and the World of Gift, 85 Cal. L. Rev.
821 (1997).
Suppose A gives B a $21,000 engagement ring. Later the engagement is bro-
ken. Does it matter who broke the engagement in determining who now owns the
ring? See Lindh v. Surman, 742 A.2d 643 (Pa. 1999) (4 to 3, adopting a no-fault
approach, holding that the ring must be returned to the donor regardless of who
broke the engagement, in an opinion by “Madame Justice Newman,” dissent by
116

“Mr. Justice Cappy in which Messrs. Justice Castillo and Saylor join” [Law French
resurrected?]). The traditional rule is that the donor cannot recover the ring if
the donor is at fault. See Annot., 44 A.L.R.5th 1 (1996).
2. O writes a check to B on her checking account and hands it to B. Before
B can cash the check, O dies. What result? See Woo v. Smart, 442 S.E.2d 690 (Va.
1994) (holding no gift until check paid, because donor retains dominion and
control of funds; donor could stop payment or die, revoking command to bank
to pay the money). But see In re Estate of Smith, 694 A.2d 1099 (Pa. Super. Ct.
1997) (holding valid gifts of checks on facts similar to those in Woo).
3. Suppose that O, while wearing a wristwatch, hands A a signed writing
saying: “I hereby give A the wristwatch I am wearing.” Is this a valid gift? The tra-
ditional rule is that the watch must be handed over, if practicable. Restatement
(Third) of Property, Wills and Other Donative Transfers §6.2 illustration 22
(2003), says that a gift of a watch by a document is valid, even though it would be
easy to take it off and hand it over. Although without case support at present, the
Restatement rule may be the rule of the future. Which is the better rule? Should
the donor be made to feel the “wrench of manual delivery”? Would the average
person know the difference between a paper reading, “I give you my watch,”
which the Restatement says should be a good gift, and a paper reading, “I will give
you my watch,” which is an unenforceable gratuitous promise?
4. Robert Hocks rented a safe deposit box jointly with his sister Joan. He
planned to give her everything he put in the box. At a restaurant, Robert handed
Joan four $5,000 bearer bonds, saying, “I want to give these to you.” Joan put the
bonds in the safe deposit box. Subsequently, Robert clipped the coupons and col-
lected the interest on the bonds.
During the next several years, Robert added 22 more bonds to the box, as
well as a diamond ring. Only Robert, not Joan, went into the box, though Joan
had a right to do so. To avoid “a lot of hassle” from Robert’s wife, Joan sug-
gested to Robert that he should leave a note in the box indicating her interest.
Robert placed a handwritten note in the box: “Upon my death, the contents
of this safety deposit box #7069 will belong to and are to be removed only by
my sister Joan Jeremiah.” Upon Robert’s death, is Joan entitled to the con-
tents of the box? See Hocks v. Jeremiah, 759 P.2d 312 (Or. App. 1988) (holding
Joan entitled only to the first four bonds that were hand delivered to her; the
remaining contents were not delivered even though Joan was a joint tenant of
the box).

Newman v. Bost
Supreme Court of North Carolina, 1898
29 S.E. 848

Action tried before Coble, J., and a jury. . . .


The plaintiff alleged in her complaint that the intestate of the defendant,
while in his last sickness, gave her all the furniture and other property in his
dwelling-house as a gift causa mortis. Among other things claimed, there was a
117

policy of insurance of $3,000 on the life of intestate and other valuable papers,
which she alleged were in a certain bureau drawer in intestate’s bedroom. She
alleged that defendant administrator has collected the policy of life insurance
and sold the household and kitchen furniture, and this suit is against defendant as
administrator to recover the value of the property alleged to have been converted
by him. There are other matters involved, claims for services, claim for fire insur-
ance collected by intestate in his lifetime, etc.
On the trial it appeared that the intestate’s wife died about ten years
before he died, and without issue; that the intestate lived in his dwelling, after
his wife’s death, in Statesville until his death, and died without issue; that about
the last day of March, 1896, he was stricken with paralysis and was confined to
his bed in his house and was never able to be out again till he died on 12 April,
1896; that shortly after he was stricken he sent for Enos Houston to nurse him
in his last illness; that while helpless in his bed soon after his confinement and
in extremis he told Houston he had to go — could not stay here — and asked
Houston to call plaintiff into his room; he then asked the plaintiff to hand
him his private keys, which plaintiff did, she having gotten them from a place
over the mantel in intestate’s bedroom in his presence and by his direction; he
then handed plaintiff the bunch of keys and told her to take them and keep
them, that he desired her to have them and everything in the house; he then
pointed out the bureau, the clock and other articles of furniture in the house
and asked his chamber door to be opened and pointed in the direction of the
hall and other rooms and repeated that everything in the house was hers — he
wanted her to have everything in the house; his voice failed him soon after the
delivery of the keys and these declarations, so that he could never talk again to
be understood, except to indicate yes and no, and this generally by a motion of
the head; the bunch of keys delivered to the plaintiff, amongst others, included
one which unlocked the bureau pointed out to plaintiff as hers (and other fur-
niture in the room), and the bureau drawer which this key unlocked, contained
in it a life insurance policy, payable to intestate’s estate, and a few small notes,
a large number of papers, receipts, etc., etc., and there was no other key that
unlocked this bureau drawer; this bureau drawer was the place where intestate
kept all his valuable papers; plaintiff kept the keys as directed from time given
her and still has them; at the death of intestate’s wife he employed plaintiff,
then an orphan about eighteen years old, to become his housekeeper, and she
remained in his service for ten years and till his death, and occupied rooms
assigned her in intestate’s residence; in 1895 the intestate declared his purpose
to marry plaintiff within twelve months; nobody resided in the house with them;
immediately after the death of intestate, Houston told of the donation to Mr.
Burke, and the plaintiff informed her attorney, Mr. Burke, of it, and she made
known her claim to the property in the house and kept the keys and forbade the
defendant from interfering with it in any way, both before and after he quali-
fied as administrator.
Other facts in relation to the plaintiff’s claim appear in the opinion. There
was a verdict, followed by judgment for the plaintiff, and defendant appealed.
118

Furches, J. The plaintiff in her complaint demands $3,000 collected by defen-


dant, as the administrator of J.F. Van Pelt,32 on a life insurance policy, and now
in his hands; $300, the value of a piano upon which said Van Pelt collected that
amount of insurance money; $200.94, the value of household property sold by
defendant as belonging to the estate of his intestate, and $45, the value of prop-
erty in the plaintiff’s bedroom and sold by the defendant as a part of the property
belonging to the intestate’s estate.
The $3,000, money collected on the life insurance policy, and the $200.94,
the price for which the household property sold, plaintiff claims belonged to her
by reason of a donatio causa mortis from said Van Pelt. The $45, the price for
which her bedroom property sold, and the $300 insurance money on the piano,
belonged to her also by reason of gifts inter vivos.
The rules of law governing all of these claims of the plaintiff are in many
respects the same, and the discussion of one will be to a considerable extent a
discussion of all.
To constitute a donatio causa mortis, two things are indispensably necessary:
an intention to make the gift, and a delivery of the thing given. Without both of
these requisites, there can be no gift causa mortis. And both these are matters of
fact to be determined by the jury, where there is evidence tending to prove them.
The intention to make the gift need not be announced by the donor in
express terms, but may be inferred from the facts attending the delivery — that
is, what the donor said and did. But it must always clearly appear that he knew
what he was doing, and that he intended a gift. So far, there was but little diversity
of authority, if any.
As to what constitutes or may constitute delivery, has been the subject of dis-
cussion and adjudication in most or all the courts of the Union and of England,
and they have by no means been uniform — some of them holding that a symboli-
cal delivery — that is, some other article delivered in the name and stead of the

32. J.F. Van Pelt was a man of some standing in Statesville, North Carolina. He
moved there in 1859 and entered the grocery business. When the Civil War broke out,
his partner joined the Confederate army, and Van Pelt stayed at home to run their busi-
ness. He was mayor of the town from 1873 to 1877 and from 1883 to 1885. He was
also manager of Statesville’s Opera Hall. His obituary in the Statesville Semi-Weekly
Landmark, April 14, 1896, printed under the heading “Called to Account,” noted:
With limited education, he was possessed of splendid business judgment
and had, by judicious management, accumulated a good property. He had been
retired from active business for several years.
Van Pelt was 62 years old when he died in his home on Front Street, having
moved there when his Walnut Street residence burned. (In the Walnut Street house was
a piano, which the plaintiff, Julia Newman, claimed had been given her and on which Van Pelt had collected the
fire insurance proceeds.) Van Pelt died intestate. His heirs were a sister living in China Grove, North Carolina,
and a brother living in Alabama.
The trial in Newman v. Bost occupied four days. The attorneys for the parties took over one day making
their closing arguments to the jury. Julia Newman’s lawyer, in closing, “spoke for about two and a half hours,
finishing at 2 o’clock, when court adjourned for dinner.” Id., January 18, 1898. (O, for the days when eloquent
lawyering could produce a hungry jury!) After dinner and lengthy deliberation, the jury unanimously found
for Julia.
Sometime after the trial Julia Newman left Statesville. About a month before Van Pelt’s death, Julia
had bought 36 acres of land from him. She sold the land in 1907, at a nice profit. The deed listed Julia, still
unmarried, as living in Maryland. The information in this footnote was furnished the editors by Bill Moose of
Mitchell Community College, Statesville, N.C. The photograph of Van Pelt is from the collection of Steve Hill
in Statesville. — Eds.
119

thing intended to be given, is sufficient; others holding that a symbolical delivery


is not sufficient, but that a constructive delivery — that is, the delivery of a key to
a locked house, trunk or other receptacle is sufficient. They distinguish this from
a symbolical delivery, and say that this is in substance a delivery of the thing, as it
is the means of using and enjoying the thing given; while others hold that there
must be an actual manual delivery to perfect a gift causa mortis.
This doctrine of donatio causa mortis was borrowed from the Roman Civil
Law by our English ancestors. There was much greater need for such a law at the
time it was incorporated into the civil law and into the English law than there is
now. Learning was not so general, nor the facilities for making wills so great then
as now. . . .
It seems to us that, . . . after the statute of fraud and of wills, this doctrine of
causa mortis is in direct conflict with the spirit and purpose of those statutes — the
prevention of fraud. It is a doctrine, in our opinion, not to be extended but to
be strictly construed and confined within the bounds of our adjudged cases. We
were at first disposed to confine it to cases of actual manual delivery, and are only
prevented from doing so by our loyalty to our own adjudications. . . .
Many of the cases cited by the plaintiff are distinguishable from ours, if not
all of them. Thomas v. Lewis (a Virginia case), 37 Am. St., 878, was probably more
relied on by the plaintiff than any other case cited, and for that reason we men-
tion it by name. This case, in its essential facts, is distinguishable from the case
under consideration. There, the articles present were taken out of the bureau
drawer, handed to the donor, and then delivered by him to the donee. According
to all the authorities, this was a good gift causa mortis. The box and safe, the key
to which the donor delivered to the donee, were not present but were deposited
in the vault of the bank; and so far as shown by the case it will be presumed, from
the place where they were and the purpose for which things are usually deposited
in a bank vault, that they were only valuable as a depository for such purposes, as
holding and preserving money and valuable papers, bonds, stocks and the like.
This box and safe would have been of little value to the donee for any other pur-
pose. But more than this, the donor expressly stated that all you find in this box
and this safe is yours. There is no mistake that it was the intention of the donor to
give what was contained in the box and in the safe.
As my Lord Coke would say: “Note the diversity” between that case and the
case at bar. There, the evidence of debt contained in the bureau, which was pres-
ent, was taken out, given to the donor, and by him delivered to the donee. This
was an actual manual delivery, good under all the authorities. But no such thing
was done in this case as to the life insurance policy. It was neither taken out of
the drawer nor mentioned by the donor, unless it is included in the testimony of
Enos Houston who, at one time, in giving his testimony says that Van Pelt gave
her the keys, saying “what is in this house is yours,” and at another time on cross-­
examination, he said to Julia, “I intend to give you this furniture in this house,”
and at another time, “What property is in this house is yours.” The bureau in
which was found the life insurance policy, after the death of Van Pelt, was present
in the room where the keys were handed to Julia, and the life insurance policy
could easily have been taken out and handed to Van Pelt, and by him delivered
to Julia, as was done in the case of Thomas v. Lewis, supra. But this was not done.
120

The safe and box, in Thomas v. Lewis, were not present, so that the contents
could not have been taken out and delivered to the donee by the donor. The
ordinary use of a stand of bureaus is not for the purpose of holding and secur-
ing such things as a life insurance policy, though they may be often used for that
purpose, while a safe and a box deposited in the vault of a bank are. A bureau
is an article of household furniture, used for domestic purposes, and generally
belongs to the ladies’ department of the household government, while the safe
and box, in Thomas v. Lewis, are not. The bureau itself, mentioned in this case,
was such property as would be valuable to the plaintiff. . . .
It is held that the law of delivery in this State is the same in gifts inter vivos
and causa mortis. Adams v. Hayes, 24 N.C. 361.  .  .  . [T]here can be no gift of
either kind without both the intention to give and the delivery. . . .
The leading case in this State is Adams v. Hayes. . . .
Following this case, . . . we feel bound to give effect to constructive delivery,
where it plainly appears that it was the intention of the donor to make the gift,
and where the things intended to be given are not present, or, where present,
are incapable of manual delivery from their size or weight. But where the articles
are present and are capable of manual delivery, this must be had. This is as far as
we can go. It may be thought by some that this is a hard rule — that a dying man
cannot dispose of his own. But we are satisfied that when properly considered, it
will be found to be a just rule. But it is not a hard rule. The law provides how a
man can dispose of all his property, both real and personal. To do this, it is only
necessary for him to observe and conform to the requirements of these laws. . . .
The law provides that every man may dispose of all of his property by will, when
made in writing. And it is most singular how guarded the law is to protect the tes-
tator against fraud and impositions by requiring that every word of the will must
be written and signed by the testator, or, if written by someone else, it must be
attested by at least two subscribing witnesses who shall sign the same in his pres-
ence and at his request, or the will is void. . . .
In gifts causa mortis it requires but one witness, probably one servant as a
witness to a gift of all the estate a man has; no publicity is to be given that the gift
has been made, and no probate or registration is required.
The statute of wills is a statute against fraud, considered in England and in
this State to be demanded by public policy. And yet, if symbolical deliveries of
gifts causa mortis are to be allowed, or if constructive deliveries be allowed to the
extent claimed by the plaintiff, the statute of wills may prove to be of little value.
For such considerations, we see every reason for restricting and none for extend-
ing the rules heretofore established as applicable to gifts causa mortis.
It being claimed and admitted that the life insurance policy was present in
the bureau drawer in the room where it is claimed the gift was made, and being
capable of actual manual delivery, we are of the opinion that the title of the
insurance policy did not pass to the plaintiff, but remained the property of the
intestate of the defendant.
But we are of the opinion that the bureau and any other article of furniture,
locked and unlocked by any of the keys given to the plaintiff, did pass and she
became the owner thereof. This is upon the ground that while these articles were
121

Residence of Mr. J.F. Van Pelt,


Walnut Street
From The (Statesville, N.C.) Landmark Trade
Edition, May 22, 1890. This house, and with it
“Miss Julia’s piano,” burned between 1890
and 1896.

present, from their size and weight they were incapable of actual manual delivery;
and that the delivery of the keys was a constructive delivery of these articles, equiv-
alent to an actual delivery if the articles had been capable of manual delivery.
[W]e are of the opinion that the other articles of household furniture
(except those in the plaintiff’s private bed chamber) did not pass to the plaintiff,
but remained the property of the defendant’s intestate.
We do not think the articles in the plaintiff’s bed chamber passed by the
donatio causa mortis for the same reason that the other articles of household
furniture did not pass — want of delivery — either constructive or manual. But
as to the furniture in the plaintiff’s bedroom ($45) it seems to us that there was
sufficient evidence of both gift and delivery to support the finding of the jury, as
a gift inter vivos. The intention to give this property is shown by a number of wit-
nesses and contradicted by none.
The only debatable ground is as to the sufficiency of the delivery. But when
we recall the express terms in which he repeatedly declared that it was hers; that
he had bought it for her and had given it to her; that it was placed in her private
chamber, her bedroom, where we must suppose that she had the entire use and
control of the same, it would seem that this was sufficient to constitute a delivery.
There was no evidence, that we remember, disputing these facts. But, if there was,
the jury have found for the plaintiff, upon sufficient evidence at least to go to the
jury, as to this gift and its delivery. As to the piano there was much evidence tend-
ing to show the intention of Van Pelt to give it to the plaintiff, and that he had
given it to her, and we remember no evidence to the contrary. And as to this, like
the bedroom furniture, the debatable ground, if there is any debatable ground, is
the question of delivery. It was placed in the intestate’s parlor where it remained
until it was burned. The intestate insured it as his property, collected and used
122

the insurance money as his own, often saying that he intended to buy the plain-
tiff another piano, which he never did. It must be presumed that the parlor was
under the dominion of the intestate, and not of his cook, housekeeper, and hired
servant. And unless there is something more shown than the fact that the piano
was bought by the intestate, placed in his parlor, and called by him “Miss Julia’s
piano,” we cannot think this constituted a delivery. But, as the case goes back
for a new trial, if the plaintiff thinks she can show a delivery she will have an
opportunity of doing so. But she will understand that she must do so according
to the rules laid down in this opinion — that she must show actual or constructive
delivery equivalent to actual manual delivery. We see no ground upon which the
plaintiff can recover the insurance money, if the piano was not hers.
We do not understand that there was any controversy as to the plaintiff’s
right to recover her services, which the jury have estimated to be $125. The view
of the case we have taken has relieved us from a discussion of the exceptions to
evidence, and as to the charge of the Court. There is no such thing in this State
as symbolical delivery in gifts either inter vivos or causa mortis. . . .
New trial.

NOTES AND PROBLEMS

1. A gift causa mortis, that is, a gift made in contemplation of and in expecta-
tion of immediate approaching death,33 is a substitute for a will. If the donor lives,
the gift is revoked, although some courts may hold that revocation occurs only
if the donor elects to revoke upon recovering. Because the courts see upholding
gifts causa mortis as undercutting the safeguards of the Statute of Wills, tradition-
ally they have more strictly applied the requirements for a valid gift causa mortis
than for a gift inter vivos. They also have placed restrictions on gifts causa mortis
not applicable to inter vivos gifts. For example, if the donee already is in posses-
sion of the property, there must be a redelivery to effect a valid gift causa mortis
but not if the gift is inter vivos. If Van Pelt had put a small cinnabar box in Julia’s
bedroom, he could during his lifetime, before death drew near, declare that he
was giving the box to Julia. But if he waited until he was on his deathbed, he
would have to deliver the box to her again.
Given changes in the law of wills, the strict approach to gifts causa mortis may
no longer be justified. The modern trend is to enforce the decedent’s intent even
if there is evidence of some failure to comply with the wills act formalities, so long
as there is clear and convincing evidence of donative intent. See, e.g., Uniform
Probate Code § 2-503 (2008).
2. Suppose that Van Pelt had said to Julia, “I want to give you my insur-
ance policy in that bureau over there, so Enos please get it and give it to her.”
Enos, however, leaves the policy where it was. Is there a valid gift? See Wilcox

33. Although older cases have been to the contrary, recent ones tend to find that the “contemplation
of imminent death” requirement is met where a person made gifts in anticipation of suicide that subsequently
occurred. See, e.g., In re Estate of Smith, 694 A.2d 1099 (Pa. Super. Ct. 1997); Scherer v. Hyland, 380 A.2d 698
(N.J. 1977).
123

v. Matteson, 9 N.W. 814 (Wis. 1881). What if Van Pelt instead had said, “I want
to give you my bureau there. Enos, move it into her room.” Enos does so. The
bureau contains the life insurance policy. On the reasoning of Newman v. Bost,
is there a valid gift?
3. Suppose that Van Pelt had called Julia in and said, “I want to give you my
bureau and the insurance policy locked in it. Here is the key.” Julia takes the key
but the bureau stays where it is. On the reasoning of Newman v. Bost, has a valid
gift been made?
4. Suppose that Van Pelt had called Julia in and said, “I want to give you my lit-
tle strong box here and the insurance policy locked in it. Here is the key.” Julia takes
the key but the box stays where it is. On the reasoning of Newman v. Bost, has a valid
gift been made? See Bynum v. Fidelity Bank of Durham, 19 S.E.2d 121 (N.C. 1942).
5. If Van Pelt had said to his wife before she died, “Dear, I give you the
piano,” would there be a gift? See Restatement (Third) of Property, Wills and
Other Donative Transfers § 6.2 illustration 7 (2003). Would this be sufficient for
a gift to Julia? If not, how could Van Pelt give the piano to Julia?

Gruen v. Gruen
Court of Appeals of New York, 1986
496 N.E.2d 869

Simons, J. Plaintiff commenced this action seeking a declaration that he is the right-
ful owner of a painting which he alleges his father, now deceased, gave to him. He
concedes that he has never had possession of the painting but asserts that his father
made a valid gift of the title in 1963 reserving a life estate for himself. His father
retained possession of the painting until he died in 1980. Defendant, plaintiff’s
stepmother, has the painting now and has refused plaintiff’s requests that she turn
it over to him. She contends that the purported gift was testamentary in nature and
invalid insofar as the formalities of a will were not met or, alternatively, that a donor
may not make a valid inter vivos gift of a chattel and retain a life estate with a com-
plete right of possession. Following a seven-day nonjury trial, Special Term found
that plaintiff had failed to establish any of the elements of an inter vivos gift and
that in any event an attempt by a donor to retain a present possessory life estate in
a chattel invalidated a purported gift of it. The Appellate Division held that a valid
gift may be made reserving a life estate and, finding the elements of a gift estab-
lished in this case, it reversed and remitted the matter for a determination of value
(104 A.D.2d 171, 488 N.Y.S.2d 401). That determination has now been made and
defendant appeals directly to this court, pursuant to CPLR 5601(d), from the sub-
sequent final judgment entered in Supreme Court awarding plaintiff $2,500,000 in
damages representing the value of the painting, plus interest. We now affirm.
The subject of the dispute is a work entitled “Schloss Kammer am Attersee
II” painted by a noted Austrian modernist, Gustav Klimt.34 It was purchased by

34. Gustav Klimt (1862-1918) was one of the founders of the Vienna Secession, a group of young fin-de-
siècle Viennese artists who sought to liberate Viennese art from the dominance of naturalist style, opening it to
such contemporary European influences as art nouveau. He created many murals for public buildings, both in
124

plaintiff’s father, Victor Gruen, in 1959 for $8,000. On April 1, 1963 the elder
Gruen, a successful architect with offices and residences in both New York City
and Los Angeles during most of the time involved in this action,35 wrote a letter
to plaintiff, then an undergraduate student at Harvard, stating that he was giving
him the Klimt painting for his birthday but that he wished to retain the posses-
sion of it for his lifetime. This letter is not in evidence, apparently because plain-
tiff destroyed it on instructions from his father. Two other letters were received,
however, one dated May 22, 1963 and the other April 1, 1963. Both had been
dictated by Victor Gruen and sent together to plaintiff on or about May 22, 1963.
The letter dated May 22, 1963 reads as follows:

Dear Michael:
I wrote you at the time of your birthday about the gift of the painting by Klimt. Now
my lawyer tells me that because of the existing tax laws, it was wrong to mention in
that letter that I want to use the painting as long as I live. Though I still want to use
it, this should not appear in the letter. I am enclosing, therefore, a new letter and I
ask you to send the old one back to me so that it can be destroyed.
I know this is all very silly, but the lawyer and our accountant insist that they must
have in their possession copies of a letter which will serve the purpose of making
it possible for you, once I die, to get this picture without having to pay inheritance
taxes on it.
Love,
s/Victor

Vienna and elsewhere, but perhaps his greatest fame was as a painter of portraits and landscapes that exhibited
an exotic and often erotic style. See Gerbert Frodl, Klimt (trans. Alexandra Campbell 1990). In 2006, a Klimt
painting, “Adele Block-Bauer I,” was purchased by cosmetics magnate Ronald S. Lauder for $135 million. It was
at the time the highest sum ever paid for a painting. The work purchased by Lauder had been the subject of an
extensive restitution battle between the Austrian government and a niece of Ms. Block-Bauer, who contended,
successfully, that the Nazis had stolen the painting and four other Klimt works during World War II.
Schloss Kammer, the subject of the painting in dispute, was Klimt’s favorite vacation spot. It is located in
the Salzkammergut, a beautiful lake district outside of Salzburg, Austria. We owe this information to Professor
Susan French, who has told the whole (and fascinating) story of the case in her essay, Susan F. French, Gruen
v. Gruen: A Tale of Two Stories, in Property Stories 75 (Gerald Korngold & Andrew P. Morriss eds., 2d ed.
2009). — Eds.
35. Victor Gruen, born in Vienna, was an urban designer and architect who came to this country in 1933.
His firm, Victor Gruen Associates, has been one of the most influential in shaping the urban environment since
World War II. It designed the first regional shopping center, Northland near Detroit, which inspired similar
plans for enormous enclosed shopping malls in other cities. Gruen was the author of several books on urban
planning, in which he said his main aim was to design cities that were worthwhile to live in as well as functional.
“Some say there is no need for a city, a center,” Gruen once said. “They say you can communicate in the future
with television phones. You may be able eventually to talk to your girl friend by television, but you can’t kiss her
that way.” His best book is The Heart of Our Cities (1964).
Gruen viewed Vienna as the most livable of cities, largely because the automobile — which he dis-
liked — had been banned from downtown. In the last years of his life he returned to live in Vienna, where he
died in 1980. See generally M. Jeffrey Hardwick, Mall Maker: Victor Gruen, Architect of an American Dream
(2003). — Eds.
125

Enclosed with this letter was a substitute gift letter, dated April 1, 1963, which
stated:
Dear Michael:
The 21st birthday, being an important event in life, should be celebrated accord-
ingly. I therefore wish to give you as a present the oil painting by Gustav Klimt of
Schloss Kammer which now hangs in the New York living room. You know that
Lazette and I bought it some 5 or 6 years ago, and you always told us how much you
liked it.
Happy birthday again.
Love
s/Victor

Plaintiff never took possession of the painting nor did he seek to do so. Except
for a brief period between 1964 and 1965 when it was on loan to art exhibits and
when restoration work was performed on it, the painting remained in his father’s
possession, moving with him from New York City to Beverly Hills and finally to
Vienna, Austria, where Victor Gruen died on February 14, 1980. Following Victor’s
death plaintiff requested possession of the Klimt painting and when defendant
refused, he commenced this action.
The issues framed for appeal are whether a valid inter vivos gift of a chattel
may be made where the donor has reserved a life estate in the chattel and the
donee never has had physical possession of it before the donor’s death and, if it
may, which factual findings on the elements of a valid inter vivos gift more nearly
comport with the weight of the evidence in this case, those of Special Term or
those of the Appellate Division. The latter issue requires application of two gen-
eral rules. First, to make a valid inter vivos gift there must exist the intent on the
part of the donor to make a present transfer; delivery of the gift, either actual
or constructive to the donee; and acceptance by the donee (Matter of Szabo, 10
N.Y.2d 94, 98, 217 N.Y.S.2d 593, 176 N.E.2d 395; Matter of Kelly, 285 N.Y. 139,
150, 33 N.E.2d 62 [dissenting in part opn.]). Second, the proponent of a gift has
the burden of proving each of these elements by clear and convincing evidence.

Donative Intent
There is an important distinction between the intent with which an inter
vivos gift is made and the intent to make a gift by will. An inter vivos gift requires
that the donor intend to make an irrevocable present transfer of ownership; if the
intention is to make a testamentary disposition effective only after death, the gift
is invalid unless made by will.
Defendant contends that the trial court was correct in finding that Victor
did not intend to transfer any present interest in the painting to plaintiff in 1963
but only expressed an intention that plaintiff was to get the painting upon his
death. The evidence is all but conclusive, however, that Victor intended to trans-
fer ownership of the painting to plaintiff in 1963 but to retain a life estate in it and
that he did, therefore, effectively transfer a remainder interest in the painting to
126

Schloss Kammer am Attersee II


Gustav Klimt
Courtesy of Galerie St. Etienne, New York

plaintiff at that time. Although the original letter was not in evidence, testimony
of its contents was received along with the substitute gift letter and its covering
letter dated May 22, 1963. The three letters should be considered together as a
single instrument (see Matter of Brandreth, 169 N.Y. 437, 440, 62 N.E. 563) and
when they are they unambiguously establish that Victor Gruen intended to make
a present gift of title to the painting at that time. But there was other evidence
for after 1963 Victor made several statements orally and in writing indicating that
he had previously given plaintiff the painting and that plaintiff owned it. Victor
Gruen retained possession of the property, insured it, allowed others to exhibit it
and made necessary repairs to it but those acts are not inconsistent with his reten-
tion of a life estate. . . . Victor’s failure to file a gift tax return on the transaction
was partially explained by allegedly erroneous legal advice he received, and while
that omission sometimes may indicate that the donor had no intention of making
a present gift, it does not necessarily do so and it is not dispositive in this case.
Defendant contends that even if a present gift was intended, Victor’s reser-
vation of a lifetime interest in the painting defeated it. . . .
127

Defendant recognizes that a valid inter vivos gift of a remainder interest


can be made not only of real property but also of such intangibles as stocks and
bonds. Indeed, several of the cases she cites so hold. That being so, it is difficult
to perceive any legal basis for the distinction she urges which would permit gifts
of remainder interests in those properties but not of remainder interests in chat-
tels such as the Klimt painting here. The only reason suggested is that the gift of
a chattel must include a present right to possession. The application of Brandreth
to permit a gift of the remainder in this case, however, is consistent with the dis-
tinction, well recognized in the law of gifts as well as in real property law, between
ownership and possession or enjoyment. Insofar as some of our cases purport to
require that the donor intend to transfer both title and possession immediately to
have a valid inter vivos gift (see Gannon v. McGuire, 160 N.Y. 476, 481, 55 N.E. 7;
Young v. Young, 80 N.Y. 422, 430), they state the rule too broadly and confuse the
effectiveness of a gift with the transfer of the possession of the subject of that gift.
The correct test is “‘whether the maker intended the [gift] to have no effect until
after the maker’s death, or whether he intended it to transfer some present interest’”
(McCarthy v. Pieret, 281 N.Y. 407, 409, 24 N.E.2d 102 [emphasis added]; see also
25 N.Y. Jur., Gifts, § 14, at 156-157). As long as the evidence establishes an intent
to make a present and irrevocable transfer of title or the right of ownership, there
is a present transfer of some interest and the gift is effective immediately. Thus,
in Speelman v. Pascal, [10 N.Y.2d 313, 222 N.Y.S.2d 324, 178 N.E.2d 723], we held
valid a gift of a percentage of the future royalties to the play “My Fair Lady” before
the play even existed. There, as in this case, the donee received title or the right
of ownership to some property immediately upon the making of the gift but pos-
session or enjoyment of the subject of the gift was postponed to some future time.
Defendant suggests that allowing a donor to make a present gift of a remain-
der with the reservation of a life estate will lead courts to effectuate otherwise
invalid testamentary dispositions of property. The two have entirely different
characteristics, however, which make them distinguishable. Once the gift is made
it is irrevocable and the donor is limited to the rights of a life tenant not an
owner. Moreover, with the gift of a remainder title vests immediately in the donee
and any possession is postponed until the donor’s death whereas under a will
neither title nor possession vests immediately. Finally, the postponement of enjoy-
ment of the gift is produced by the express terms of the gift not by the nature of
the instrument as it is with a will (see Robb v. Washington & Jefferson Coll., 185
N.Y. 485, 493, 78 N.E. 359).

Delivery
In order to have a valid inter vivos gift, there must be a delivery of the gift,
either by a physical delivery of the subject of the gift or a constructive or symbolic
delivery such as by an instrument of gift, sufficient to divest the donor of dominion
and control over the property. As the statement of the rule suggests, the require-
ment of delivery is not rigid or inflexible, but is to be applied in light of its pur-
pose to avoid mistakes by donors and fraudulent claims by donees. Accordingly,
what is sufficient to constitute delivery “must be tailored to suit the circumstances
of the case” (Matter of Szabo, supra, 10 N.Y.2d at 98, 217 N.Y.S.2d 593, 176
128

N.E.2d 395). The rule requires that “‘[t]he delivery necessary to consummate a
gift must be as perfect as the nature of the property and the circumstances and
surroundings of the parties will reasonably permit’” (id.).
Defendant contends that when a tangible piece of personal property such as
a painting is the subject of a gift, physical delivery of the painting itself is the best
form of delivery and should be required. Here, of course, we have only delivery
of Victor Gruen’s letters which serve as instruments of gift. Defendant’s state-
ment of the rule as applied may be generally true, but it ignores the fact that what
Victor Gruen gave plaintiff was not all rights to the Klimt painting, but only title
to it with no right of possession until his death. Under these circumstances, it
would be illogical for the law to require the donor to part with possession of the
painting when that is exactly what he intends to retain.
Nor is there any reason to require a donor making a gift of a remainder
interest in a chattel to physically deliver the chattel into the donee’s hands only
to have the donee redeliver it to the donor. As the facts of this case demonstrate,
such a requirement could impose practical burdens on the parties to the gift
while serving the delivery requirement poorly. Thus, in order to accomplish this
type of delivery the parties would have been required to travel to New York for
the symbolic transfer and redelivery of the Klimt painting which was hanging on
the wall of Victor Gruen’s Manhattan apartment. Defendant suggests that such a
requirement would be stronger evidence of a completed gift, but in the absence
of witnesses to the event or any written confirmation of the gift it would provide
less protection against fraudulent claims than have the written instruments of gift
delivered in this case.

Acceptance
Acceptance by the donee is essential to the validity of an inter vivos gift,
but when a gift is of value to the donee, as it is here, the law will presume an
acceptance on his part. Plaintiff did not rely on this presumption alone but also
presented clear and convincing proof of his acceptance of a remainder interest
in the Klimt painting by evidence that he had made several contemporaneous
statements acknowledging the gift to his friends and associates, even showing
some of them his father’s gift letter, and that he had retained both letters for over
17 years to verify the gift after his father died. Defendant relied exclusively on
affidavits filed by plaintiff in a matrimonial action with his former wife, in which
plaintiff failed to list his interest in the painting as an asset. These affidavits were
made over 10 years after acceptance was complete and they do not even approach
the evidence in Matter of Kelly (285 N.Y. 139, 148-149, 33 N.E.2d 62 [dissenting
in part opn.], supra) where the donee, immediately upon delivery of a diamond
ring, rejected it as “too flashy.” We agree with the Appellate Division that inter-
pretation of the affidavit was too speculative to support a finding of rejection and
overcome the substantial showing of acceptance by plaintiff.
Accordingly, the judgment appealed from and the order of the Appellate
Division brought up for review should be affirmed, with costs.
129

POSTSCRIPT
When Victor’s son Michael finally received the painting from Kamija, Victor’s
widow, he immediately arranged for Sotheby’s to auction it in London. Sotheby’s
sold the painting on June 30, 1987, for $5.3 million, then a record price for
Klimt’s work. Ten years later, the buyer sold the painting at auction for $23.5
million. The painting ended up in Galleria Nazionale d’Arte Moderna, in Rome,
Italy. See French, A Tale of Two Stories, supra, at 95.

NOTES AND QUESTIONS

1. If Victor Gruen had wanted to give Michael the complete ownership of


the painting and not reserve a life estate, could he have done so by a letter sent
to Michael at Harvard?
2. Suppose that Victor Gruen had typed and signed a letter to Michael: “I
give you the Klimt painting when I die.” Would this be a valid lifetime gift? It
would not. The letter is a will. It shows no intention to give Michael any rights
now, but only when Victor dies. As a will, the instrument is not valid unless prop-
erly executed as a will, with witnesses.
Carefully distinguish a will from what Victor actually did. He wrote: “I give
you the Klimt painting, reserving possession for my life.” This gives Michael a pres-
ent ownership interest in the painting, with possession postponed until Victor’s
death.
Gruen v. Gruen introduces you to the concept of a life estate (in Victor) and
a remainder (in Michael). Each of these estates is a separate interest in the same
property, entitling first the life tenant to possession, and then, after his death, the
remainderman. We will examine these estates in Chapters 4 and 5.
3. Should Victor’s widow, Kamija, have had any rights with respect to the
painting? If Victor had retained it until death and devised it to Michael, Kamija
might have been able to claim a portion of the value of the painting as part of her
statutory elective share, a subject that we will study in Chapter 6. See pages 446-
447. Should the result be different if Victor had transferred a remainder interest
during his life, retaining a life interest in the painting? See Uniform Probate
Code § 2-205(2)(A) (2008) (value of assets transferred during decedent’s life
with retained lifetime possessory interest is subject to surviving spouse’s elective
share).
4. For an exhaustive treatment of the law of gifts, comparing U.S. law
with its counterparts in other countries, see Richard Hyland, Gifts: A Study in
Comparative Law (2009).
Chapter 3

The Limits and Possibilities of


Real Property, Personal Property,
and Intellectual Property

Chapter 1 considers the law’s treatment of resources that are nature’s handiwork
like the earth itself, or wild animals. And Chapter 2 considers the law’s treatment
of property that is owned initially by someone, and subsequently claimed by some-
one else. The kinds of resources at issue in cases like these are land and personal
property. But there is a third kind of resource that takes on great importance in
modern societies, and the means by which that resource arises is creation, rather
than capture. We are speaking here of intellectual property — property in ideas
(patents) and expressions (copyrights), as well as brands (trademarks) and pro-
prietary secrets (trade secrets). This chapter will consider how someone obtains
ownership rights in these information resources, and what limits on such owner-
ship arise so as to protect the public’s interest. As we will see, some of these limits
on the ownership of information have close analogs in the realm of real estate
and personal property, whereas others do not.
Information is relatively nonrivalrous and nonexcludable. A resource is non-
rivalrous when your use of it does not interfere with the use of it by other peo-
ple. Consider a recipe for macaroni and cheese. Your use of the recipe generally
won’t interfere with other people’s enjoyment of the same information. Provided
you have all the ingredients, you can each use the same recipe to make a tasty
dinner. Now consider the cheese itself. That resource is rivalrous. Any cheese that
you consume is cheese that others cannot eat. A resource is nonexcludable when it
is difficult to prevent people from using it. The musical notes for a popular song
are nonexcludable. Someone who composes music and releases it to the public
will have a hard time preventing people from playing the tune on their own gui-
tars or singing the song in the shower. It might even be challenging to discover
when musicians are performing the song in public. The physical embodiment of
a song on a vinyl record, by contrast, is relatively excludable. If you maintain pos-
session of the record itself, you can prevent third parties from using it or copying

131
132

it. And if you own the only copy of the record, you can maintain perfect control
over the music it contains. See Soraya Nadia McDonald, “Pharma Bro” Martin
Shkreli Bought that Exclusive, Single-Issue Wu-Tang Clan Album, Wash. Post.,
Dec. 9, 2015. Studying relatively nonrivalrous, nonexcludable resources like intel-
lectual property alongside personal property and real property is fruitful because
it will help you examine how rivalry and excludability might alter the justifica-
tions for protecting property, the limits of ownership, the stakes of disputes, the
pertinent tradeoffs, and so much else.
After introducing the initial acquisition of intellectual property, this chapter
explores the deep connections among the law of real property, personal prop-
erty, and intellectual property. It is tempting to caricature property law as an
archaic set of rules that govern the ownership of resources that used to be impor-
tant — farmland, whales, jewels, and the like. It turns out that the rules developed
to resolve disputes about those kinds of resources continue to shape debates over
modern society’s crown jewels. The old rules have something to teach us about
who owns inventions, artistic masterpieces, famous brands, and even life itself.
This chapter concludes by examining the frontiers of ownership. If you own land,
or personal property, or an idea, can you use it however you desire? Under what
circumstances do the interests of a broader public limit your autonomy to use
property as you wish?

A. Acquisition by Creation

Concentrate your sweat on one story, rather than dissipate it over a dozen. Don’t
loaf and invite inspiration; light out after it with a club, and if you don’t get it you
will nonetheless get something that looks remarkably like it.
Jack London,
Getting into Print, 1905

Creativity is just connecting things. When you ask creative people how they did
something, they feel a little guilty because they didn’t really do it, they just saw some-
thing. It seemed obvious to them after a while.
Steve Jobs,
Quoted in Wired Magazine, Feb. 1, 1996

An observer from abroad has argued that the following principle “is part of the
common law”:

Any expenditure of mental or physical effort, as a result of which there is created


an entity, whether tangible or intangible, vests in the person who brought the entity
into being, a proprietary right to the commercial exploitation of that entity, which
right is separate and independent from the ownership of that entity. [D.F. Libling,
The Concept of Property: Property in Intangibles, 94 L.Q. Rev. 103, 104 (1978).]
133

The assertion is that if you create something — if in that sense you are first in
time — then that something is most certainly yours to exploit, because, Libling
argues, “the foundation of proprietary rights is the expenditure of labour and
money (which merely represents past effort).” Id. at 119. So the underlying idea
seems to derive from John Locke, who reasoned that you own the fruits of your
labor in consequence of having “a property in your own person.” See Note 4 on
page 15.
The trouble is that the fruits of your labor are not always yours alone to
exploit, and you do not always have full rights of property in your own person.
Why? The materials in this section address that question.

1.  roperty in One’s Expressions and Ideas: General Principles


P
of Copyright and Patent Law

The law of property in information — or intellectual property, as it is called — is


a large and lively subject treated in depth in advanced courses. Our aim here is
most certainly not to study all the doctrines and details. Instead, our objectives are
to introduce the key features of intellectual property rights and to examine the
extent to which they resemble property rights in things.

International News Service v. Associated Press


Supreme Court of the United States, 1918
248 U.S. 215

Justice Pitney delivered the opinion of the Court.


The parties are competitors in the gathering and distribution of news
and its publication for profit in newspapers throughout the United States. The
Associated Press [or AP, complainant] .  . . gathers in all parts of the world, by
means of various instrumentalities of its own, by exchange with its members, and
by other appropriate means, news and intelligence of current and recent events
of interest to newspaper readers and distributes it daily to its members for publi-
cation in their newspapers. . . .
Defendant [INS] is a corporation organized under the laws of the State of
New Jersey, whose business is the gathering and selling of news to its customers
and clients, consisting of newspapers published throughout the United States,
under contracts by which they pay certain amounts at stated times for defendant’s
service. . . .
The parties are in the keenest competition between themselves in the distri-
bution of news throughout the United States; and so, as a rule, are the newspa-
pers that they serve, in their several districts. . . .
The bill was filed to restrain the pirating of complainant’s news by defendant
in three ways: First, by bribing employees of newspapers published by complain-
ant’s members to furnish AP news to INS before publication, for transmission by
telegraph and telephone to defendant’s clients for publication by them; Second,
134

by inducing AP members to violate its by-laws and permit defendant to obtain


news before publication; and Third, by copying news from bulletin boards and
from early editions of complainant’s newspapers and selling this, either bodily or
after rewriting it, to defendant’s customers.1
The District Court, upon consideration of the bill and answer, with volumi-
nous affidavits on both sides, granted a preliminary injunction under the first and
second heads; but refused at that stage to restrain the systematic practice admit-
tedly pursued by INS, of taking news bodily from the bulletin boards and early
editions of AP’s newspapers and selling it as its own. . . . The only matter that has
been argued before us is whether INS may lawfully be restrained from appropriat-
ing news taken from bulletins issued by AP or any of its members, or from news-
papers published by them, for the purpose of selling it to INS clients. AP asserts
that INS’s admitted course of conduct in this regard both violates AP’s property
right in the news and constitutes unfair competition in business. And notwith-
standing the case has proceeded only to the stage of a preliminary injunction,
we have deemed it proper to consider the underlying questions, since they go to
the very merits of the action and are presented upon facts that are not in dispute.
As presented in argument, these questions are: 1. Whether there is any property
in news; 2. Whether, if there be property in news collected for the purpose of
being published, it survives the instant of its publication in the first newspaper
to which it is communicated by the news-gatherer; and 3. Whether defendant’s
admitted course of conduct in appropriating for commercial use matter taken
from bulletins or early editions of AP publications constituted unfair competition
in trade. . . .
AP’s news matter is not copyrighted. It is said that it could not, in practice,
be copyrighted, because of the large number of dispatches that are sent daily;
and . . . news is not within the operation of the copyright act. Defendant, while
apparently conceding this, nevertheless invokes the analogies of the law of liter-
ary property and copyright, insisting as its principal contention that, assuming AP
has a right of property in its news, it can be maintained (unless the copyright act
be complied with) only by being kept secret and confidential, and that upon the
publication with AP’s consent of uncopyrighted news by any of AP’s members in
a newspaper or upon a bulletin board, the right of property is lost, and the subse-
quent use of the news by the public or by INS for any purpose whatever becomes
lawful. . . .
In considering the general question of property in news matter, it is neces-
sary to recognize its dual character, distinguishing between the substance of the
information and the particular form or collocation of words in which the writer
has communicated it.
No doubt news articles often possess a literary quality, and are the subject of
literary property at the common law; nor do we question that such an article, as

1. According to one account, the actions of INS (which was owned by William Randolph Hearst) owed
to the fact that its correspondents were barred “during much of World War I by British and French censors
from sending war dispatches to the United States, because Hearst had offended the British and French by sid-
ing with Germany at the outset of the war.” Richard A. Posner, Misappropriation: A Dirge, 40 Hous. L. Rev. 621,
627 (2003). Another account says simply that INS was barred because it violated censorship regulations. L. Ray
Patterson & Stanley W. Lindberg, The Nature of Copyright: A Law of Users’ Rights 180 (1991). — Eds.
135

a literary production, is the subject of copyright by the terms of the act as it now
stands.
But the news element — the information respecting current events con-
tained in the literary production — is not the creation of the writer, but is a report
of matters that ordinarily are publici juris; it is the history of the day. It is not to be
supposed that the framers of the constitution, when they empowered Congress
“to promote the progress of science and useful arts, by securing for limited times
to authors and inventors the exclusive right to their respective writings and dis-
coveries” (Const., Art. I, §8, par. 8), intended to confer upon one who might hap-
pen to be the first to report a historic event the exclusive right for any period to
spread the knowledge of it.
We need spend no time, however, upon the general question of property
in news matter at common law, or the application of the copyright act, since it
seems to us the case must turn upon the question of unfair competition in busi-
ness. . . . The peculiar value of news is in the spreading of it while it is fresh; and it
is evident that a valuable property interest in the news, as news, cannot be main-
tained by keeping it secret. Besides, except for matter improperly disclosed, or
published in breach of trust or confidence, or in violation of law, none of which
is involved in this branch of the case, the news of current events may be regarded
as common property. What we are concerned with is the business of making it
known to the world, in which both parties to the present suit are engaged. . . . The
parties are competitors in this field; and, on fundamental principles, applicable
here as elsewhere, when rights or privileges of the one are liable to conflict with
those of the other, each party is under a duty so to conduct its own business as not
unnecessarily or unfairly to injure that of the other.
. . . The question here is not so much the rights of either party as against
the public but their rights as between themselves. And although we may and
do assume that neither party has any remaining property interest as against the
public in uncopyrighted news matter after the moment of its first publication, it
by no means follows that there is no remaining property interest in it as between
themselves. For, to both of them alike, news matter, however little susceptible of
ownership or dominion in the absolute sense, is stock in trade, to be gathered
at the cost of enterprise, organization, skill, labor, and money, and to be distrib-
uted and sold to those who will pay money for it, as for any other merchandise.
Regarding the news, therefore, as but the material out of which both parties are
seeking to make profits at the same time and in the same field, we hardly can fail
to recognize that for this purpose, and as between them, it must be regarded as
quasi property, irrespective of the rights of either as against the public. . . .
The peculiar features of the case arise from the fact that, while novelty and
freshness form so important an element in the success of the business, the very
processes of distribution and publication necessarily occupy a good deal of time.
AP’s service, as well as defendant’s, is a daily service to daily newspapers; most of
the foreign news reaches this country at the Atlantic seaboard, principally at the
city of New York, and because of this, and of time differentials due to the earth’s
rotation, the distribution of news matter throughout the country is principally
from east to west; and, since in speed the telegraph and telephone easily outstrip
the rotation of the earth, it is a simple matter for defendant to take complainant’s
136

news from bulletins or early editions of complainant’s members in the eastern


cities and at the mere cost of telegraphic transmission cause it to be published
in western papers issued at least as early as those served by complainant. Besides
this, and irrespective of time differentials, irregularities in telegraphic transmis-
sion on different lines, and the normal consumption of time in printing and
distributing the newspaper, result in permitting pirated news to be placed in the
hands of defendant’s readers sometimes simultaneously with the service of com-
peting AP papers, occasionally even earlier.
INS insists that when, with the sanction and approval of complainant, and as
the result of the use of its news for the very purpose for which it is distributed, a
portion of AP’s members communicate to the general public by posting it upon
bulletin boards so that all may read, or by issuing it to newspapers and distribut-
ing it indiscriminately, complainant no longer has the right to control the use to
be made of it; that when it thus reaches the light of day it becomes the common
possession of all to whom it is accessible; and that any purchaser of a newspaper
has the right to communicate the intelligence which it contains to anybody and
for any purpose, even for the purpose of selling it for profit to newspapers pub-
lished for profit in competition with complainant’s members.
The fault in the reasoning lies in applying as a test the right of the complain-
ant as against the public, instead of considering the rights of complainant and
defendant, competitors in business, as between themselves. The right of the pur-
chaser of a single newspaper to spread knowledge of its contents gratuitously, for
any legitimate purpose not unreasonably interfering with complainant’s right to
make merchandise of it, may be admitted; but to transmit that news for commer-
cial use, in competition with complainant — which is what defendant has done
and seeks to justify — is a very different matter. In doing this defendant, by its very
act, admits that it is taking material that has been acquired by complainant as the
result of organization and the expenditure of labor, skill, and money, and which
is salable by complainant for money, and that defendant in appropriating it and
selling it as its own is endeavoring to reap where it has not sown, and by disposing
of it to newspapers that are competitors of complainant’s members is appropri-
ating to itself the harvest of those who have sown. Stripped of all disguises, the
process amounts to an unauthorized interference with the normal operation of
complainant’s legitimate business precisely at the point where the profit is to be
reaped, in order to divert a material portion of the profit from those who have
earned it to those who have not; with special advantage to defendant in the com-
petition because of the fact that it is not burdened with any part of the expense of
gathering the news. The transaction speaks for itself, and a court of equity ought
not to hesitate long in characterizing it as unfair competition in business. . . .
The contention that the news is abandoned to the public for all purposes
when published in the first newspaper is untenable. Abandonment is question
of intent, and the entire organization of the AP negatives such a purpose. The
cost of the service would be prohibitive if the reward were to be so limited. No
single newspaper, no small group of newspapers, could sustain the expenditure.
Indeed, it is one of the most obvious results to defendant’s theory that, by permit-
ting indiscriminate publication by anybody and everybody for purposes of profit
in competition with the news-gatherer, it would render publication profitless, or
137

so little profitable as in effect to cut off the service by rendering the cost prohibi-
tive in comparison with the return. . . .
It is said that the elements of unfair competition are lacking because there is
no attempt by defendant to palm off its goods as those of the complainant, char-
acteristic of the most familiar, if not the most typical cases of unfair competition.
But we cannot concede that the right to equitable relief is confined to that class
of cases. In the present case the fraud upon complainant’s rights is more direct
and obvious. Regarding news matter as the mere material from which these two
competing parties are endeavoring to make money, and treating it, therefore, as
quasi property for the purposes of their business because they are both selling it
as such, defendant’s conduct differs from the ordinary case of unfair competition
in trade principally in this that, instead of selling its own goods as those of com-
plainant, it substitutes misappropriation in the place of misrepresentation, and
sells complainant’s goods as its own. . . .
The decree of the Circuit Court of Appeals will be Affirmed.
[The concurring opinion of Justice Holmes and the dissenting opinion of
Justice Brandeis are omitted.]

NOTES AND QUESTIONS

1. The rest of the story.  Contrary to conventional accounts, there was no evi-
dence that INS was copying bulletins on the East Coast and transmitting them
to newspapers on the West Coast. INS was just a convenient defendant that AP
needed to establish a broad legal precedent that would protect its position as a
natural monopoly. In the early twentieth century, the wire service was primarily a
large network of leased telegraph lines. The cost of creating the network dwarfed
the cost of gathering the news, an activity that AP spent little time or effort actually
doing. Enhancing its market power even further, AP was a member of an inter-
national cartel that gave it exclusive rights to bulletins of foreign news services
and access to foreign government communiqués. Technological and economic
changes (e.g., substituting teletype machines for telegraph operators) threatened
AP’s monopoly position, opening it up to previously unknown competition. To
block its potential competitors, AP sought a broad legal principle that recognized
a property right in news. What it needed was a ready defendant whom it could
charge with copying “its” news. It found one in INS. The chief of INS’s bureau in
Cleveland had bribed an AP reporter to provide him with the news there. As for
copying, INS had copied some of AP’s material, but not very much or very often.
The claim of copying was just a convenient excuse for bringing a lawsuit.
After the Supreme Court’s decision, AP and INS settled. It was in their self-
interest to do so because their relationship was mutually advantageous. INS,
which was owned by William Randolph Hearst, wanted to continue to obtain the
benefits of AP’s service. On the other side, the members of AP, a cooperative of
subscribers, did not wish to offend the powerful Mr. Hearst. At the end of the day,
the case had very little effect on the way INS did business. For a full account of the
story, see Douglas G. Baird, The Story of INS v. AP: Property, Natural Monopoly,
and the Uneasy Legacy of a Concocted Controversy, in Intellectual Property
Stories 9 (Jane C. Ginsburg & Rochelle Cooper Dreyfuss eds., 2006).
138

AP newsroom circa 1920


Source: Associated Press

2. Copying and the common law.  In Cheney Brothers v. Doris Silk Corp., 35
F.2d 279 (2d Cir. 1929), cert. denied, 281 U.S. 738 (1930), the plaintiff sought
protection of designs of silks that it manufactured. Some of the silks succeeded
commercially and some of them did not, and even commercially successful pat-
terns did not last more than eight or nine months on the market. The defendant,
Doris Silk, made copies of successful Cheney Brothers prints and sold them at a
cheaper price. Cheney Brothers asked for an injunction, although only for the
duration of one season. Neither patent nor copyright law provided protection,
for practical and legal reasons, so Cheney Brothers relied on INS.
The Second Circuit, in an opinion by Learned Hand, denied relief, stating
a basic rule: “In the absence of some recognized right at common law, or under
the statutes . . . a man’s property is limited to the chattels which embody his inven-
tion. Others may imitate these at their pleasure.” The court distinguished INS by
limiting it to its facts.
Today, in general, fashion designs are not protected under intellectual prop-
erty law in the United States, but legislation is regularly introduced in Congress
to provide such protection under the federal Copyright Act. Scholars continue
to debate the desirability of expanding intellectual property protection in the
fashion industry. Compare Kal Raustiala & Christopher Sprigman, The Knockoff
Economy: How Imitation Sparks Innovation (2012) (copyright protection not
necessary to spur innovation in the fashion industry), with C. Scott Hemphill &
Jeannie Suk, The Law, Culture, and Economics of Fashion, 61 Stan. L. Rev. 1147
(2009) (stronger copyright protections are appropriate).
3. The “hot news” doctrine.  If the general principle today is that of Cheney
Brothers — in the absence of some recognized right, people are free to imitate or
139

copy the original — then what is the current status of INS? The misappropriation
doctrine developed in the case eventually fell into disuse, but recent years have
seen a revival of sorts. Led by the Second Circuit, a few courts have developed a
“hot news” doctrine, largely on the basis of INS. Under the Second Circuit’s hot
news doctrine, a newsgatherer may recover from a defendant when (1) the news-
gathering or collection process involves significant expenditures; (2) the col-
lected news or information is time-sensitive; (3) the defendant free rides on the
collected material; (4) the freeriding directly competes with the newsgatherer’s
market; and (5) the freeriding is likely to diminish incentives to collect news/
information in a timely fashion. National Basketball Assn. v. Motorola, Inc., 105
F.3d 841, 852-853 (2d Cir. 1997). See also Barclays Capital, Inc. v. Theflyonthewall.
com, Inc., 650 F.3d 876 (2d Cir. 2011) (no misappropriation found when tfotw.
com leaked stock tips; claim was preempted by the Copyright Act); Fox News
Network, LLC v. TVEyes, Inc., 43 F. Supp. 3d 379 (S.D.N.Y. 2014) (Copyright
Act preemption defeats claim against news aggregation service). See generally
Shyamkrishna Balganesh, “Hot News”: The Enduring Myth of Property in the
News, 111 Colum. L. Rev. 419 (2011).
4. Intellectual property and labor theory.  As noted at the outset of this section,
intellectual property is often defended on the basis of John Locke’s labor the-
ory of property. Indeed, from one perspective intellectual creation seems more
like creation out of nothing than creation of tangible products from resources
removed from an original commons. On this reasoning, intellectual property
does not seem to involve the same complications of trying to separate out the
relative contributions of individual laborers and the materials on which they have
labored. See Gregory S. Alexander & Eduardo M. Peñalver, An Introduction to
Property Theory 192 (2010). But do intellectual creations really spring from
nothing beyond the mind of the creator? See id. at 193-194.
In this connection, recall the Court’s observation in INS (at page 136) that
the defendant was “endeavoring to reap where it has not sown.  .  .  .” So what?
Consider the following from Douglas G. Baird, Common Law Intellectual
Property and the Legacy of International News Service v. Associated Press, 50 U. Chi.
L. Rev. 411, 413-414 (1983):

That an individual has the right to reap what he has sown . . . is far from self-
evident even as applied to tangible property. . . . We typically can reap only the wheat
we sow on our own land, and how land becomes private property in the first place
remains a mystery. In any event, wheat and information are fundamentally different
from one another. It is the nature of wheat or land or any other tangible property
that possession by one person precludes possession by anyone else. . . . Many peo-
ple, however, can use the same piece of information. . . .
The value of the information to AP derived in part from its ability to keep
its rivals from copying the information it gathered. But deciding that it could not
enjoy its news exclusively is not the same as telling a farmer he must hand over
wheat he has grown to someone who merely watched him grow it. Deciding against
AP would not mean that it would lose all revenue from its news-gathering efforts.
People would still pay for the AP’s news. . . .
That the analogy between wheat and information does not apply with full
force, however, does not mean that it should not apply at all. One can still argue that
140

individuals have the right to enjoy the fruits of their labors, even when the labors are
intellectual. But granting individuals exclusive rights to the information they gather
conflicts with other rights in a way that granting exclusive rights to tangible property
does not. In a market economy, granting individuals exclusive rights to property is
an effective way of allocating scarce resources. Saying that someone should be able
to own a particular good or piece of land and should be able to keep others from
getting it unless they pay him is unobjectionable once one accepts the desirability
of a market economy. Granting exclusive rights to information does not, however,
necessarily promote a market economy. Competition depends upon imitation. One
person invests labor and money to create a product, such as a food processor, that
people will buy. Others may imitate him and take advantage of the new market by
selling their own food processors. Their machines may incorporate their own ideas
about how such machines should be made. As a result, the quality of the machines
may rise and their price may fall. The first person is made worse off than he would
be if he had had an exclusive right to his idea, because his competitors are enjoying
the fruits of his labor and are not paying for it. Nevertheless, the public as a whole
may be better off, as long as this freedom to imitate does not destroy the incentive
for people to come up with new devices.

For further elaboration on some of these ideas and an exploration of the quasi-
property concept that loomed large in INS, see Shyamkrishna Balganesh, Quasi-
Property: Like, But Not Quite Property, 160 U. Pa. L. Rev. 1889 (2012).
5. Intellectual property law.  The law of intellectual property — copyright, pat-
ent, trade secrets, and trademark — grants limited monopolies over protected
material. The point of the monopolies is to promote creative activity; the point
of the limits is to advance competition (which in turn facilitates consumption by
holding prices down). The design of the systems entails difficult trade-offs, as you
will see below.

a. Copyright
Copyright protects artistic or other creative expression. Under federal law,
embodied in the Copyright Act of 1976, 17 U.S.C. §101 et seq., copyright holders
have the right to prevent others from reproducing their work, creating derivative
works, distributing copies of the work to the public, performing the work publicly,
displaying the work publicly, and performing the work by digital audio transmis-
sion. Of course, copyright holders may and frequently do sell others licenses to
use their works in particular ways; they may also assign (transfer) their copyrights
to others. Copyright protection has gradually been extended in duration over
the years. Hence it is necessary to know when a particular work was created and,
for works created before 1978, whether the copyright was renewed. Generally, for
works created on or after January 1, 1978, the rule is that protection extends for
the life of the author plus 70 years, and this term cannot be renewed.
Federal law imposes three requirements for copyright protection: original-
ity, work of authorship, and fixation. Originality means that the work must be an
independent creation of the author and must demonstrate at least some minimal
degree of creativity.
Work of authorship is a fairly broad term. The federal statute identifies eight
types of such works: literary works; musical works; dramatic works; pantomimes
141

and choreographic works; pictorial, graphic, and sculptural works; motion pic-
tures and other audiovisual works; sound recordings; and architectural works.
The term “literary works” is interpreted to include computer programs. What is
not covered is important: First, not covered is any “idea, procedure, process, sys-
tem, method of operation, concept, principle, or discovery.” 17 U.S.C. §102(b).
Running throughout copyright law is the idea-expression distinction. Copyright
law protects expressions, not ideas. It protects the form or mode by which ideas
are expressed rather than the ideas themselves. Second, strictly functional works,
such as systems or procedures, are protected by patent law, not copyright.
Fixation means that the work be fixed in some kind of tangible medium,
such as on a printed page, a CD, a canvas, or a computer hard drive. Even human
skin may constitute a tangible medium of expression, enabling tattoo artists to
qualify for copyright protection. See Matthew Beasley, Note, Who Owns Your
Skin: Intellectual Property Law and Norms Among Tattoo Artists, 85 S. Cal. L.
Rev. 1137, 1145 (2012).
In recent years, the Supreme Court has expressed concerns about the
importance of not unduly restricting public access to information. The following
case decided whether copyright protection was available for collections of basic
information, in this case telephone numbers.

Feist Publications, Inc. v. Rural Telephone Service Co.


Supreme Court of the United States, 1991
499 U.S. 340

Justice O’Connor delivered the opinion of the Court.


This case requires us to clarify the extent of copyright protection available to
telephone directory white pages.
Rural Telephone Service Company is a certified public utility that provides
telephone service to several communities in northwest Kansas. It is subject to a
state regulation that requires all telephone companies operating in Kansas to
issue annually an updated telephone directory. Accordingly, as a condition of
its monopoly franchise, Rural publishes a typical telephone directory, consist-
ing of white pages and yellow pages. The white pages list in alphabetical order
the names of Rural’s subscribers, together with their towns and telephone num-
bers. The yellow pages list Rural’s business subscribers alphabetically by category
and feature classified advertisement of various sizes. Rural distributes its direc-
tory free of charge to its subscribers, but earns revenue by selling yellow pages
advertisements.
Feist Publications, Inc., is a publishing company that specializes in areawide
telephone directories. Unlike a typical directory, which covers only a particular
calling area, Feist’s areawide directories cover a much larger geographical range,
reducing the need to call directory assistance or consult multiple directories. The
Feist directory that is the subject of this litigation covers 11 different telephone
service areas in 15 counties and contains 46,878 white pages listings — compared
to Rural’s approximately 7,700 listings. Like Rural’s directory, Feist’s is distributed
142

free of charge and includes both white pages and yellow pages. Feist and Rural
compete vigorously for yellow pages advertising.
As the sole provider of telephone service in its service area, Rural obtains
subscriber information quite easily. Persons desiring telephone service must
apply to Rural and provide their names and addresses; Rural then assigns them a
telephone number. Feist is not a telephone company, let alone one with monop-
oly status, and therefore lacks independent access to any subscriber information.
To obtain white pages listings for its areawide directory, Feist approached each
of the 11 telephone companies operating in northwest Kansas and offered to pay
for the right to use its white pages listings.
Of the 11 telephone companies, only Rural refused to license its listings
to Feist. Rural’s refusal created a problem for Feist, as omitting these listings
would have left a gaping hole in its areawide directory, rendering it less attrac-
tive to potential yellow pages advertisers. In a decision subsequent to that which
we review here, the District Court determined that this was precisely the reason
Rural refused to license its listings. The refusal was motivated by an unlawful pur-
pose “to extend its monopoly in telephone service to a monopoly in yellow pages
advertising.” Rural Telephone Service Co. v. Feist Publications, Inc., 737 F. Supp.
610, 622 (Kan. 1990).
Unable to license Rural’s white pages listings, Feist used them without
Rural’s consent. Feist began by removing several thousand listings that fell out-
side the geographic range of its areawide directory, then hired personnel to inves-
tigate the 4,935 that remained. These employees verified the data reported by
Rural and sought to obtain additional information. As a result, a typical Feist
listing includes the individual’s street address; most of Rural’s listings do not.
Notwithstanding these additions, however, 1,309 of the 46,878 listings in Feist’s
1983 directory were identical to listings in Rural’s 1982-1983 white pages. Four
of these were fictitious listings that Rural had inserted into its directory to detect
copying.
Rural sued for copyright infringement in the District Court for the District
of Kansas, taking the position that Feist, in compiling its own directory, could
not use the information contained in Rural’s white pages. . . . The District Court
granted summary judgment to Rural. . . . [T]he Court of Appeals for the Tenth
Circuit affirmed “for substantially the reasons given by the district court.” We
granted certiorari to determine whether the copyright in Rural’s directory pro-
tects the names, towns, and telephone numbers copied by Feist.
This case concerns the interaction of two wellestablished propositions. The
first is that facts are not copyrightable; the other, that compilations of facts gener-
ally are. Each of these propositions possesses an impeccable pedigree. . . .
There is an undeniable tension between these two propositions. Many com-
pilations consist of nothing but raw data — i.e., wholly factual information not
accompanied by any original written expression. On what basis may one claim a
copyright in such a work? Common sense tells us that 100 uncopyrightable facts
do not magically change their status when gathered together in one place. Yet
copyright law seems to contemplate that compilations that consist exclusively of
facts are potentially within its scope.
143

The key to resolving the tension lies in understanding why facts are not copy-
rightable. The sine qua non of copyright is originality. To qualify for copyright pro-
tection, a work must be original to the author. . . . To be sure, the requisite level of
creativity is extremely low; even a slight amount will suffice. The vast majority of
works make the grade quite easily, as they possess some creative spark, “no matter
how crude, humble or obvious” it might be. Originality does not signify novelty;
a work may be original even though it closely resembles other works, so long as
the similarity is fortuitous, not the result of copying. To illustrate, assume that
two poets, each ignorant of the other, compose identical poems. Neither work is
novel, yet both are original and, hence, copyrightable. . . .
It is this bedrock principle of copyright that mandates the law’s seemingly
disparate treatment of facts and factual compilations. . . . The distinction is one
between creation and discovery: the first person to find and report a particular
fact has not created the fact; he or she has merely discovered its existence. . . .
Census-takers, for example, do not “create” the population figures that emerge
from their efforts; in a sense, they copy these figures from the world around
them. . . . Census data therefore do not trigger copyright, because these data are
not “original” in the constitutional sense. . . .
Factual compilations, on the other hand, may possess the requisite original-
ity. The compilation author typically chooses which facts to include, in what order
to place them, and how to arrange the collected data so that they may be used
effectively by readers. These choices as to selection and arrangement, so long as
they are made independently by the compiler and entail a minimal degree of
creativity, are sufficiently original that Congress may protect such compilations
through the copyright laws. . . . Thus, even a directory that contains absolutely no
protectible written expression, only facts, meets the constitutional minimum for
copyright protection if it features an original selection or arrangement. . . .
This protection is subject to an important limitation. The mere fact that a
work is copyrighted does not mean that every element of the work may be pro-
tected. Originality remains the sine qua non of copyright; accordingly, copyright
protection may extend only to those components of a work that are original to
the author. . . .
This inevitably means that the copyright in a factual compilation is thin.
Notwithstanding a valid copyright, a subsequent compiler remains free to use
the facts contained in another’s publication to aid in preparing a competing
work, so long as the competing work does not feature the same selection and
arrangement. . . .
It may seem unfair that much of the fruit of the compiler’s labor may be
used by others without compensation. . . . The primary objective of copyright is
not to reward the labor of authors, but “[t]o promote the Progress of Science and
useful Arts.” Art. I, 8, cl. 8. To this end, copyright assures authors the right to their
original expression, but encourages others to build freely upon the ideas and
information conveyed by a work. This principle, known as the idea/expression
or fact/expression dichotomy, applies to all works of authorship. As applied to
a factual compilation, assuming the absence of original written expression, only
the compiler’s selection and arrangement may be protected; the raw facts may
144

be copied at will. This result is neither unfair nor unfortunate. It is the means by
which copyright advances the progress of science and art. . . .
Most courts . . . understood from this Court’s decisions that there could be
no copyright without originality. . . .
But some courts misunderstood the [copyright] statute. . . . [They inferred]
erroneously that directories and the like were copyrightable per se, “without any
further or precise showing of original-personal-authorship.” . . . [They] developed
a new theory to justify the protection of factual compilations. Known alternatively
as “sweat of the brow” or “industrious collection,” the underlying notion was that
copyright was a reward for the hard work that went into compiling facts. . . .
[This] “sweat of the brow” doctrine had numerous flaws, the most glaring
being that it extended copyright protection in a compilation beyond selection
and arrangement — the compiler’s original contributions — to the facts them-
selves. Under the doctrine, the only defense to infringement was independent
creation. A subsequent compiler was “not entitled to take one word of informa-
tion previously published,” but rather had to “independently wor[k] out the mat-
ter for himself, so as to arrive at the same result from the same common sources
of information.” Jeweler’s Circular Publishing Co. v. Keystone Publishing Co.,
281 F. 83, 88-89 (2d Cir. 1922). “Sweat of the brow” courts thereby eschewed the
most fundamental axiom of copyright law — that no one may copyright facts or
ideas. . . .
Decisions of this Court applying the 1909 Act make clear that the statute did
not permit the “sweat of the brow” approach. The best example is International
News Service v. Associated Press, 248 U.S. 215 (1918). In that decision, the Court
stated unambiguously that the 1909 Act conferred copyright protection only on
those elements of a work that were original to the author. . . .
There is no doubt that Feist took from the white pages of Rural’s direc-
tory a substantial amount of factual information. At a minimum, Feist copied
the names, towns, and telephone numbers of 1,309 of Rural’s subscribers. Not
all copying, however, is copyright infringement. To establish infringement, two
elements must be proven: (1) ownership of a valid copyright, and (2) copying
of constituent elements of the work that are original. The first element is not at
issue here; Feist appears to concede that Rural’s directory, considered as a whole,
is subject to a valid copyright because it contains some foreword text, as well as
original material in its yellow pages advertisements.
The question is whether Rural has proved the second element. In other
words, did Feist, by taking 1,309 names, towns, and telephone numbers from
Rural’s white pages, copy anything that was “original” to Rural? Certainly, the raw
data does not satisfy the originality requirement. Rural may have been the first
to discover and report the names, towns, and telephone numbers of its subscrib-
ers, but this data does not “ ’ow[e] its origin’ ” to Rural. . . . Rather, these bits of
information are uncopyrightable facts; they existed before Rural reported them,
and would have continued to exist if Rural had never published a telephone
directory. . . .
The question that remains is whether Rural selected, coordinated, or
arranged these uncopyrightable facts in an original way. As mentioned, originality
145

is not a stringent standard; it does not require that facts be presented in an inno-
vative or surprising way. It is equally true, however, that the selection and arrange-
ment of facts cannot be so mechanical or routine as to require no creativity
whatsoever. The standard of originality is low, but it does exist. . . .
The selection, coordination, and arrangement of Rural’s white pages do
not satisfy the minimum constitutional standards for copyright protection. As
mentioned at the outset, Rural’s white pages are entirely typical. . . . In preparing
its white pages, Rural simply takes the data provided by its subscribers and lists it
alphabetically by surname. The end product is a garden-variety white pages direc-
tory, devoid of even the slightest trace of creativity.
Rural’s selection of listings could not be more obvious: It publishes the most
basic information — name, town, and telephone number — about each person
who applies to it for telephone service. This is “selection” of a sort, but it lacks the
modicum of creativity necessary to transform mere selection into copyrightable
expression. Rural expended sufficient effort to make the white pages directory
useful, but insufficient creativity to make it original. . . .
Nor can Rural claim originality in its coordination and arrangement of facts.
The white pages do nothing more than list Rural’s subscribers in alphabetical
order. This arrangement may, technically speaking, owe its origin to Rural; no
one disputes that Rural undertook the task of alphabetizing the names itself.
But there is nothing remotely creative about arranging names alphabetically in a
white pages directory. . . .
We conclude that the names, towns, and telephone numbers copied by Feist
were not original to Rural and therefore were not protected by the copyright
in Rural’s combined white and yellow pages directory. As a constitutional mat-
ter, copyright protects only those constituent elements of a work that possess
more than a de minimis quantum of creativity. Rural’s white pages, limited to basic
subscriber information and arranged alphabetically, fall short of the mark. As a
statutory matter, 17 U.S.C. §101 does not afford protection from copying to a col-
lection of facts that are selected, coordinated, and arranged in a way that utterly
lacks originality. Given that some works must fail, we cannot imagine a more
likely candidate. Indeed, were we to hold that Rural’s white pages pass muster, it
is hard to believe that any collection of facts could fail. . . .
The judgment of the Court of Appeals is Reversed.

NOTES AND QUESTIONS

1. The originality requirement, the “sweat-of-the-brow” doctrine, and labor theory.  Feist
is perhaps the most important copyright decision dealing with the requirement
that the work be original. Until Feist, several decisions had applied the “sweat-
of-the-brow” doctrine. Under that doctrine, an author gains copyright protec-
tion simply on the basis of effort and expense; no originality is required. Feist is
important, among other reasons, because it rejects that doctrine: “[O]riginality,
not ‘sweat of the brow,’ is the touchstone of copyright protection in directories
and other factbased works.  .  .  .” Feist is also important because of the Court’s
146

interpretation of originality. The test for originality, the Court indicates, is a mod-
icum of creativity. Compilations of preexisting data may be copyrighted if they
displayed sufficient creativity.
This is not the first time that we have seen the idea behind the sweat-of-the-
brow doctrine. As the Court in Feist indicated, it is evident in the INS case. But
even prior to that, we saw it in Pierson v. Post. Sweat-of-the-brow reasoning is the
thrust of Justice Livingston’s dissenting opinion in that case. There is some appeal
to the idea that a person should be rewarded for her efforts, but recall Douglas
Baird’s observation, made in connection with INS (see pages 139-140), that we
do not always reap where we sow. Why did the Court in Feist reject the sweat-of-
the brow doctrine? And what about creativity — is that a better approach? (If so,
better in what respect?) Finally, to pull this discussion together, should Rural be
able to sue Feist successfully under an unfair competition theory like the ones
advanced in Keeble and INS?
2. Other kinds of compilations.  Suppose a yoga instructor assembles a sequence
of 26 yoga poses and includes them in a best-selling book about yoga. A rival yoga
instructor begins teaching classes using the same sequence of poses. The first
yoga instructor sues the second for infringing his copyright in the compilation
of poses and exercises. What result? See Bikram’s Yoga College of India, L.P. v.
Evolation Yoga, LLC, 803 F.3d 1032 (9th Cir. 2015) (holding that the sequence
is an idea, not an expression, and a compilation of ideas is still not protectable
under copyright).
3. Whose originality?  Wildlife photographer David Slater spent several weeks
photographing a group of macaque monkeys in an Indonesian forest. Slater was
having a hard time getting close-up shots of the monkeys’ faces because his lens
made them nervous, so one day he put his camera on a tripod, set the camera to
autofocus, and walked away to see whether the monkeys might take the photo-
graphs for him. A curious monkey named Naruto approached the camera and
started pressing buttons. The result: the first known monkey selfie. Before long,
the monkey’s photo had made its way to Wikipedia, which used the photo without
Slater’s permission. Had Slater’s copyright been infringed? Not according to the
U.S. copyright office, which said that to be copyrightable a work must be created
by a human being. U.S. Copyright Office, Compendium of U.S. Copyright Office
Practices § 313.2 (3d ed. 2014). Works created by animals (as well as plants(!)(?))
are not copyrightable. Id. It was not enough that Slater had set up the camera,
chosen the direction it would point in, and placed it in proximity to the monkeys.
Did the Copyright Office reach the right result? See Shyamkrishna Balganesh,
Causing Copyright, 117 Colum. L. Rev. 1, 2-5, 38-39, 56 (2017).
In related litigation, People for the Ethical Treatment of Animals (PETA)
sued Slater on Naruto’s behalf, asserting that Naruto should be the copyright
holder of the photographs. The case was dismissed on the grounds that the
Copyright Act does not confer standing on animals to sue in federal court. See
Naruto v. Slater, 2016 WL 362231 (N.D. Cal. Jan. 28, 2016). Naruto’s appeal
before the Ninth Circuit was argued in 2017, but the case settled before the
appeals court could hand down its decision. In the settlement, Slater agreed to
donate 25% of all fees he earned from licensing the monkey selfies to charities
147

protecting macaques in Indonesia. See Settlement Reached over Monkey’s Selfie:


Camera Owner Gives 25% of Revenue to Groups that Aid Crested Macaques, L.A.
Times, Sept. 12, 2017, at 4. But 25% of zero is zero. How could Slater generate
any revenue from the images, given the Copyright Office’s determination?
4. Databases.  Feist throws into question the status, vis-à-vis copyright pro-
tection, of various sorts of factual compilations. For example, what is the sta-
tus of automated databases after Feist? Are they entitled to protection, or do
they lack sufficient creativity? The status of such factual compilations is unclear
after Feist, and lower federal courts have interpreted Feist in quite different ways.
Compare BellSouth Advertising & Publishing Corp. v. Donnelley Information
Publishing, 999 F.2d 1436 (11th Cir. 1993) (en banc) (yellow pages directory
unprotectable because act of separating categories of businesses would “merge
with the idea of listing such entities as a class of businesses in a business direc-
tory”), with Key Publications, Inc. v. Chinatown Today Publishing Enterprises,
945 F.2d 509 (2d Cir. 1991) (court protected copied directory that differed from
BellSouth directory only by solely including businesses thought to be of interest
to Chinese-Americans).
Owners of databases and other factual compilations sometimes rely on alter-
native legal means of protecting their “sweat-of-the-brow” investments. Contract
law has been especially popular in the wake of Feist. See, e.g., ProCD, Inc. v.
Zeidenberg, 86 F.3d 1447 (7th Cir. 1996). Trade secrets law also protects infor-
mation in databases and lists, provided that access to them is tightly controlled,
the owners take reasonable precautions to maintain their confidentiality, and
the database or list has independent economic value. Under trade secrets law,
competitors can recreate the same databases or lists through the sweat of their
own brows, but taking shortcuts (via hacking, convincing employees to breach a
duty of confidentiality, or the like) would amount to unlawful misappropriation.
Although trade secrets protections arose under state law for most of the nation’s
history, federal law has begun to play a more significant role of late, especially
since the enactment of the federal Defend Trade Secrets Act of 2016, 18 U.S.C.
§1836 et seq.
5. Infringement.  Feist notes that a copyright holder seeking to prevail in an
infringement suit must show ownership of a valid copyright in the work and copy-
ing by the defendant. See page 144. Although the federal courts differ in the way
they formulate the test, proving copying generally requires a showing of (a) an
actual opportunity to copy the original work (i.e., access to it), and (b) that the
original work and allegedly infringing work “share enough unique features to
give rise to a breach of the duty not to copy” the original. See Peters v. West, 692
F.3d 629, 633-634 (7th Cir. 2012).
6. Copyright estoppel.  There is no question that Feist copied Rural’s four ficti-
tious telephone listings. Did that copying amount to copyright infringement? Not
according to the doctrine of copyright estoppel, which states that if a copyright
holder presents false information as factual, it cannot then turn around and sue
for infringement, asserting that the false information is copyrightable because of
its non-factual character. See Nester’s Map & Guide Corp. v. Hagstrom Map. Co.,
796 F. Supp. 729, 733 (E.D.N.Y. 1992).
148

The most important defense in an infringement action is usually fair use. It is


also perhaps the most confusing (and confused) area of copyright law. The next
case illustrates the operation of the fair use doctrine in a contemporary context.

Authors Guild v. Google, Inc.


United States Court of Appeals for the Second Circuit, 2015
804 F.3d 202

Leval, J. This copyright dispute tests the boundaries of fair use. Plaintiffs, who
are authors of published books under copyright, sued Google, Inc. (“Google”)
for copyright infringement in the United States District Court for the Southern
District of New York. They appeal from the grant of summary judgment in
Google’s favor. Through its Library Project and its Google Books project, acting
without permission of rights holders, Google has made digital copies of tens of
millions of books, including Plaintiffs’, that were submitted to it for that purpose
by major libraries. Google has scanned the digital copies and established a pub-
licly available search function. An Internet user can use this function to search
without charge to determine whether the book contains a specified word or term
and also see “snippets” of text containing the searched-for terms. . . . These activ-
ities of Google are alleged to constitute infringement of Plaintiffs’ copyrights.
Plaintiffs sought injunctive and declaratory relief as well as damages.
Google defended on the ground that its actions constitute “fair use,” which,
under 17 U.S.C. §  107, is “not an infringement.” The district court agreed.
Authors Guild, Inc. v. Google Inc., 954 F. Supp. 2d 282, 294 (S.D.N.Y. 2013).
Plaintiffs brought this appeal.
Plaintiffs contend the district court’s ruling was flawed.  .  .  . They argue
[that] Google’s digital copying of entire books, allowing users through the snip-
pet function to read portions, is not a “transformative use” within the meaning
of Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 578-585 (1994), and pro-
vides a substitute for Plaintiffs’ works; [and that] notwithstanding that Google
provides public access to the search and snippet functions without charge and
without advertising, its ultimate commercial profit motivation and its derivation
of revenue from its dominance of the world-wide Internet search market to which
the books project contributes, preclude a finding of fair use. . . . We reject these
arguments and conclude that the district court correctly sustained Google’s fair
use defense.
. . .
The author-plaintiffs are Jim Bouton, author of Ball Four; Betty Miles, author
of The Trouble with Thirteen; and Joseph Goulden, author of The Superlawyers: The
Small and Powerful World of the Great Washington Law Firms. Each of them has a legal
or beneficial ownership in the copyright for his or her book. Their books have
been scanned without their permission by Google, which made them available to
Internet users for search and snippet view on Google’s website.
Google’s Library Project, which began in 2004, involves bi-lateral agree-
ments between Google and a number of the world’s major research libraries.
149

Under these agreements, the participating libraries select books from their col-
lections to submit to Google for inclusion in the project. Google makes a digital
scan of each book, extracts a machine-readable text, and creates an index of the
machine-readable text of each book. Google retains the original scanned image
of each book, in part so as to improve the accuracy of the machine-readable texts
and indices as image-to-text conversion technologies improve.
Since 2004, Google has scanned, rendered machine-readable, and indexed
more than 20 million books, including both copyrighted works and works in the
public domain. The vast majority of the books are non-fiction, and most are out
of print. All of the digital information created by Google in the process is stored
on servers protected by the same security systems Google uses to shield its own
confidential information.
The digital corpus created by the scanning of these millions of books enables
the Google Books search engine. Members of the public who access the Google
Books website can enter search words or terms of their own choice, receiving in
response a list of all books in the database in which those terms appear, as well as
the number of times the term appears in each book. A brief description of each
book, entitled “About the Book,” gives some rudimentary additional informa-
tion, including a list of the words and terms that appear with most frequency in
the book. It sometimes provides links to buy the book online and identifies librar-
ies where the book can be found. The search tool permits a researcher to identify
those books, out of millions, that do, as well as those that do not, use the terms
selected by the researcher. Google notes that this identifying information instan-
taneously supplied would otherwise not be obtainable in lifetimes of searching.
No advertising is displayed to a user of the search function. Nor does Google
receive payment by reason of the searcher’s use of Google’s link to purchase the
book.
. . .
The Google Books search function also allows the user a limited viewing of
text. In addition to telling the number of times the word or term selected by the
searcher appears in the book, the search function will display a maximum of three
“snippets” containing it. A snippet is a horizontal segment comprising ordinarily
an eighth of a page. Each page of a conventionally formatted book in the Google
Books database is divided into eight non-overlapping horizontal segments, each
such horizontal segment being a snippet. (Thus, for such a book with 24 lines to
a page, each snippet is comprised of three lines of text.) Each search for a par-
ticular word or term within a book will reveal the same three snippets, regardless
of the number of computers from which the search is launched. Only the first
usage of the term on a given page is displayed. Thus, if the top snippet of a page
contains two (or more) words for which the user searches, and Google’s program
is fixed to reveal that particular snippet in response to a search for either term,
the second search will duplicate the snippet already revealed by the first search,
rather than moving to reveal a different snippet containing the word because the
first snippet was already revealed. Google’s program does not allow a searcher to
increase the number of snippets revealed by repeated entry of the same search
term or by entering searches from different computers. A searcher can view more
than three snippets of a book by entering additional searches for different terms.
150

However, Google makes permanently unavailable for snippet view one snippet
on each page and one complete page out of every ten — a process Google calls
“blacklisting.”
Google also disables snippet view entirely for types of books for which a
single snippet is likely to satisfy the searcher’s present need for the book, such as
dictionaries, cookbooks, and books of short poems. Finally, since 2005, Google
will exclude any book altogether from snippet view at the request of the rights
holder by the submission of an online form.
. . .
On November 14, 2013, the district court granted Google’s motion for sum-
mary judgment, concluding that the uses made by Google of copyrighted books
were fair uses, protected by §  107. Authors Guild, 954 F. Supp. 2d at 284. Upon
consideration of the four statutory factors of § 107, the district court found that
Google’s uses were transformative, that its display of copyrighted material was prop-
erly limited, and that the Google Books program did not impermissibly serve as a mar-
ket substitute for the original works. Id. at 290. The court entered judgment initially
on November 27, 2013, followed by an amended judgment on December 10, 2013,
dismissing Plaintiffs’ claims with prejudice. Plaintiffs filed timely notice of appeal.
The ultimate goal of copyright is to expand public knowledge and under-
standing, which copyright seeks to achieve by giving potential creators exclusive
control over copying of their works, thus giving them a financial incentive to
create informative, intellectually enriching works for public consumption. This
objective is clearly reflected in the Constitution’s empowerment of Congress
“To promote the Progress of Science .  .  . by securing for limited Times to Authors
. . . the exclusive Right to their respective Writings.” U.S. Const., Art. I, § 8, cl. 8
(emphasis added). Thus, while authors are undoubtedly important intended
beneficiaries of copyright, the ultimate, primary intended beneficiary is the pub-
lic, whose access to knowledge copyright seeks to advance by providing rewards
for authorship.
For nearly three hundred years, since shortly after the birth of copyright in
England in 1710, courts have recognized that, in certain circumstances, giving
authors absolute control over all copying from their works would tend in some
circumstances to limit, rather than expand, public knowledge. In the words of
Lord Ellenborough, “[W]hile I shall think myself bound to secure every man in
the enjoyment of his copy-right, one must not put manacles upon science.” Cary
v. Kearsley, 170 Eng. Rep. 679, 681, 4 Esp. 168, 170 (1802). Courts thus developed
the doctrine, eventually named fair use, which permits unauthorized copying in
some circumstances, so as to further “copyright’s very purpose, ‘[t]o promote
the Progress of Science and useful Arts.’” Campbell v. Acuff-Rose Music, Inc., 510
U.S. 569, 575 (1994) (quoting U.S. Const., Art. I, § 8, cl. 8). Although well estab-
lished in the common law development of copyright, fair use was not recognized
in the terms of our statute until the adoption of § 107 in the Copyright Act of
1976. 17 U.S.C. §§ 101 et seq.
Section 107, in its present form, provides:

[T]he fair use of a copyrighted work . . . for purposes such as criticism, com-
ment, news reporting, teaching (including multiple copies for classroom use),
151

scholarship, or research, is not an infringement of copyright. In determining


whether the use made of a work in any particular case is a fair use the factors to be
considered shall include — 
(1) the purpose and character of the use, including whether such use is of a
commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copy-
righted work as a whole; and
(4) the effect of the use upon the potential market for or value of the copy-
righted work.
The fact that a work is unpublished shall not itself bar a finding of fair use if such
finding is made upon consideration of all the above factors.

17 U.S.C. §  107. As the Supreme Court has designated fair use an affirmative
defense, see Campbell, 510 U.S. at 590, the party asserting fair use bears the burden
of proof, Am. Geophysical Union v. Texaco Inc., 60 F.3d 913, 918 (2d Cir. 1994).
.  .  . The purpose of the enactment was to give recognition in the statute
itself to such an important part of copyright law developed by the courts through
the common law process. “Congress meant § 107 to restate the present judicial
doctrine of fair use, not to change, narrow, or enlarge it an any way, and intended
that courts continue the common-law tradition of fair use adjudication.” Campbell,
510 U.S. at 577. Furthermore, notwithstanding fair use’s long common-law his-
tory, not until the Campbell ruling in 1994 did courts undertake to explain the
standards for finding fair use.
The Campbell Court undertook a comprehensive analysis of fair use’s
requirements, discussing every segment of § 107. Beginning with the examples
of purposes set forth in the statute’s preamble, the Court made clear that they
are “illustrative and not limitative” and “provide only general guidance about the
sorts of copying that courts and Congress most commonly ha[ve] found to be fair
uses.” 510 U.S. at 577-578 (internal quotations and citations omitted). The statute
“calls for case-by-case analysis” and “is not to be simplified with bright-line rules.”
Id. at 577. Section 107’s four factors are not to “be treated in isolation, one from
another. All are to be explored, and the results weighed together, in light of the
purposes of copyright.” Id. at 578. Each factor thus stands as part of a multifac-
eted assessment of the crucial question: how to define the boundary limit of the
original author’s exclusive rights in order to best serve the overall objectives of
the copyright law to expand public learning while protecting the incentives of
authors to create for the public good.
At the same time, the Supreme Court has made clear that some of the stat-
ute’s four listed factors are more significant than others. The Court observed in
Harper & Row Publishers, Inc. v. Nation Enterprises that the fourth factor, which
assesses the harm the secondary use can cause to the market for, or the value of,
the copyright for the original, “is undoubtedly the single most important ele-
ment of fair use.” 471 U.S. 539, 566 (1985). This is consistent with the fact that
the copyright is a commercial right, intended to protect the ability of authors to
profit from the exclusive right to merchandise their own work.
In Campbell, the Court stressed also the importance of the first factor, the
“purpose and character of the secondary use.” 17 U.S.C. § 107(1). The more the
152

appropriator is using the copied material for new, transformative purposes, the
more it serves copyright’s goal of enriching public knowledge and the less likely
it is that the appropriation will serve as a substitute for the original or its plausible
derivatives, shrinking the protected market opportunities of the copyrighted work.
510 U.S. at 591 (noting that, when the secondary use is transformative, “market sub-
stitution is at least less certain, and market harm may not be so readily inferred”).
With this background, we proceed to discuss each of the statutory factors,
as illuminated by Campbell and subsequent case law, in relation to the issues here
in dispute.

A. Factor One
Campbell ’s explanation of the first factor’s inquiry into the “purpose and
character” of the secondary use focuses on whether the new work, “in Justice
Story’s words, . . . merely ‘supersede[s] the objects’ of the original creation, . . . or
instead adds something new, with a further purpose. . . . [I]t asks, in other words,
whether and to what extent the new work is ‘transformative.’” 510 U.S. at 578-579
(citations omitted). While recognizing that a transformative use is “not absolutely
necessary for a finding of fair use,” the opinion further explains that the “goal of
copyright, to promote science and the arts, is generally furthered by the creation
of transformative works” and that “[s]uch works thus lie at the heart of the fair
use doctrine’s guarantee of breathing space within the confines of copyright.” Id.
at 579. In other words, transformative uses tend to favor a fair use finding because
a transformative use is one that communicates something new and different from
the original or expands its utility, thus serving copyright’s overall objective of con-
tributing to public knowledge.
The word “transformative” cannot be taken too literally as a sufficient key to
understanding the elements of fair use. It is rather a suggestive symbol for a com-
plex thought, and does not mean that any and all changes made to an author’s
original text will necessarily support a finding of fair use. The Supreme Court’s
discussion in Campbell gave important guidance on assessing when a transforma-
tive use tends to support a conclusion of fair use. The defendant in that case
defended on the ground that its work was a parody of the original and that par-
ody is a time-honored category of fair use. Explaining why parody makes a stron-
ger, or in any event more obvious, claim of fair use than satire, the Court stated,

[T]he heart of any parodist’s claim to quote from existing material . . . is the
use of . . . a prior author’s composition to . . . comment[ ] on that author’s works. . . . If,
on the contrary, the commentary has no critical bearing on the substance or style of
the original composition, which the alleged infringer merely uses to get attention
or to avoid the drudgery in working up something fresh, the claim to fairness in
borrowing from another’s work diminishes accordingly (if it does not vanish). . . .
Parody needs to mimic an original to make its point, and so has some claim to use
the creation of its victim’s . . . imagination, whereas satire can stand on its own two
feet and so requires justification for the very act of borrowing.

Id. at 580-581 (emphasis added). In other words, the would-be fair user of another’s
work must have justification for the taking. A secondary author is not necessarily
153

at liberty to make wholesale takings of the original author’s expression merely


because of how well the original author’s expression would convey the secondary
author’s different message. Among the best recognized justifications for copy-
ing from another’s work is to provide comment on it or criticism of it. A tak-
ing from another author’s work for the purpose of making points that have no
bearing on the original may well be fair use, but the taker would need to show a
justification. . . .
. . .
We have no difficulty concluding that Google’s making of a digital copy of
Plaintiffs’ books for the purpose of enabling a search for identification of books
containing a term of interest to the searcher involves a highly transformative pur-
pose, in the sense intended by Campbell. Our court’s exemplary discussion in
HathiTrust informs our ruling. That case involved a dispute that is closely related,
although not identical, to this one. Authors brought claims of copyright infringe-
ment against HathiTrust, an entity formed by libraries participating in the Google
Library Project to pool the digital copies of their books created for them by
Google. The suit challenged various usages HathiTrust made of the digital cop-
ies. Among the challenged uses was HathiTrust’s offer to its patrons of “full-text
searches,” which, very much like the search offered by Google Books to Internet
users, permitted patrons of the libraries to locate in which of the digitized books
specific words or phrases appeared. 755 F.3d at 98. (HathiTrust’s search facility
did not include the snippet view function, or any other display of text.) We con-
cluded that both the making of the digital copies and the use of those copies to
offer the search tool were fair uses. Id. at 105.
Notwithstanding that the libraries had downloaded and stored complete
digital copies of entire books, we noted that such copying was essential to permit
searchers to identify and locate the books in which words or phrases of interest
to them appeared. Id. at 97. We concluded “that the creation of a full-text search-
able database is a quintessentially transformative use . . . [as] the result of a word
search is different in purpose, character, expression, meaning, and message from
the page (and the book) from which it is drawn.” Id. . . .
As with HathiTrust .  .  . , the purpose of Google’s copying of the original
copyrighted books is to make available significant information about those books,
permitting a searcher to identify those that contain a word or term of interest,
as well as those that do not include reference to it. . . . We have no doubt that
the purpose of this copying is the sort of transformative purpose described in
Campbell as strongly favoring satisfaction of the first factor.
. . .
Plaintiffs correctly point out that this case is significantly different from
HathiTrust in that the Google Books search function allows searchers to read snip-
pets from the book searched, whereas HathiTrust did not allow searchers to view
any part of the book. Snippet view adds important value to the basic transforma-
tive search function, which tells only whether and how often the searched term
appears in the book. Merely knowing that a term of interest appears in a book does
not necessarily tell the searcher whether she needs to obtain the book, because it
does not reveal whether the term is discussed in a manner or context falling within
the scope of the searcher’s interest. For example, a searcher seeking books that
154

explore Einstein’s theories, who finds that a particular book includes 39 usages of
“Einstein,” will nonetheless conclude she can skip that book if the snippets reveal
that the book speaks of “Einstein” because that is the name of the author’s cat. In
contrast, the snippet will tell the searcher that this is a book she needs to obtain if
the snippet shows that the author is engaging with Einstein’s theories.
Google’s division of the page into tiny snippets is designed to show the
searcher just enough context surrounding the searched term to help her evalu-
ate whether the book falls within the scope of her interest (without revealing so
much as to threaten the author’s copyright interests). Snippet view thus adds
importantly to the highly transformative purpose of identifying books of interest
to the searcher. With respect to the first factor test, it favors a finding of fair use
(unless the value of its transformative purpose is overcome by its providing text in
a manner that offers a competing substitute for Plaintiffs’ books, which we discuss
under factors three and four below).
Plaintiffs also contend that Google’s commercial motivation weighs in
their favor under the first factor. Google’s commercial motivation distinguishes
this case from HathiTrust, as the defendant in that case was a non-profit entity
founded by, and acting as the representative of, libraries. Although Google has
no revenues flowing directly from its operation of the Google Books functions,
Plaintiffs stress that Google is profit-motivated and seeks to use its dominance of
book search to fortify its overall dominance of the Internet search market, and
that thereby Google indirectly reaps profits from the Google Books functions.
. . .
Our court has . . . repeatedly rejected the contention that commercial moti-
vation should outweigh a convincing transformative purpose and absence of sig-
nificant substitutive competition with the original. See Cariou v. Prince, 714 F.3d
694, 708 (2d Cir. 2013); Castle Rock Entm’t, Inc. v. Carol Pub. Grp., Inc., 150 F.3d
132, 141-142 (2d Cir. 1998).
While we recognize that in some circumstances, a commercial motivation on
the part of the secondary user will weigh against her, especially, as the Supreme
Court suggested, when a persuasive transformative purpose is lacking, Campbell,
510 U.S. at 579, we see no reason in this case why Google’s overall profit moti-
vation should prevail as a reason for denying fair use over its highly convincing
transformative purpose, together with the absence of significant substitutive com-
petition, as reasons for granting fair use. Many of the most universally accepted
forms of fair use, such as news reporting and commentary, quotation in historical
or analytic books, reviews of books, and performances, as well as parody, are all
normally done commercially for profit.

B. Factor Two
The second fair use factor directs consideration of the “nature of the copy-
righted work.” While the “transformative purpose” inquiry discussed above is con-
ventionally treated as a part of first factor analysis, it inevitably involves the second
factor as well. One cannot assess whether the copying work has an objective that
differs from the original without considering both works, and their respective
objectives.
155

 The second factor has rarely played a significant role in the determination
of a fair use dispute. . . . The Supreme Court in Harper & Row made a passing
observation in dictum that, “[t]he law generally recognizes a greater need to dis-
seminate factual works than works of fiction or fantasy.” 471 U.S. 539, 563 (1985).
Courts have sometimes speculated that this might mean that a finding of fair use
is more favored when the copying is of factual works than when copying is from
works of fiction. However, while the copyright does not protect facts or ideas set
forth in a work, it does protect that author’s manner of expressing those facts
and ideas. At least unless a persuasive fair use justification is involved, authors of
factual works, like authors of fiction, should be entitled to copyright protection
of their protected expression. The mere fact that the original is a factual work
therefore should not imply that others may freely copy it. Those who report the
news undoubtedly create factual works. It cannot seriously be argued that, for
that reason, others may freely copy and re-disseminate news reports.2
In considering the second factor in HathiTrust, we concluded that it was “not
dispositive,” 755 F.3d at 98, commenting that courts have hardly ever found that
the second factor in isolation played a large role in explaining a fair use decision.
The same is true here. While each of the three Plaintiffs’ books in this case is
factual, we do not consider that as a boost to Google’s claim of fair use. If one (or
all) of the plaintiff works were fiction, we do not think that would change in any
way our appraisal. . . .

C. Factor Three
The third statutory factor instructs us to consider “the amount and substan-
tiality of the portion used in relation to the copyrighted work as a whole.” The
clear implication of the third factor is that a finding of fair use is more likely when
small amounts, or less important passages, are copied than when the copying is
extensive, or encompasses the most important parts of the original. The obvious
reason for this lies in the relationship between the third and the fourth factors.
The larger the amount, or the more important the part, of the original that is
copied, the greater the likelihood that the secondary work might serve as an
effectively competing substitute for the original, and might therefore diminish
the original rights holder’s sales and profits.
The Google Books program has made a digital copy of the entirety of each of
Plaintiffs’ books. Notwithstanding the reasonable implication of Factor Three that
fair use is more likely to be favored by the copying of smaller, rather than larger,
portions of the original, courts have rejected any categorical rule that a copying
of the entirety cannot be a fair use. Complete unchanged copying has repeatedly
been found justified as fair use when the copying was reasonably appropriate to

2. We think it unlikely that the Supreme Court meant in its concise dictum that secondary authors are
at liberty to copy extensively from the protected expression of the original author merely because the material
is factual. What the Harper & Row dictum may well have meant is that, because in the case of factual writings,
there is often occasion to test the accuracy of, to rely on, or to repeat their factual propositions, and such testing
and reliance may reasonably require quotation (lest a change of expression unwittingly alter the facts), factual
works often present well justified fair uses, even if the mere fact that the work is factual does not necessarily
justify copying of its protected expression.
156

achieve the copier’s transformative purpose and was done in such a manner that
it did not offer a competing substitute for the original. The Supreme Court said
in Campbell that “the extent of permissible copying varies with the purpose and
character of the use” and characterized the relevant questions as whether “the
amount and substantiality of the portion used . . . are reasonable in relation to
the purpose of the copying,” Campbell, 510 U.S. at 586-587, noting that the answer
to that question will be affected by “the degree to which the [copying work] may
serve as a market substitute for the original or potentially licensed derivatives,” id.
at 587-588 (finding that, in the case of a parodic song, “how much . . . is reason-
able will depend, say, on the extent to which the song’s overriding purpose and
character is to parody the original or, in contrast, the likelihood that the parody
may serve as a market substitute for the original”).
In HathiTrust, our court concluded in its discussion of the third factor that
“[b]ecause it was reasonably necessary for the [HathiTrust Digital Library] to
make use of the entirety of the works in order to enable the full-text search
function, we do not believe the copying was excessive.” 755 F.3d at 98. As with
HathiTrust, not only is the copying of the totality of the original reasonably appro-
priate to Google’s transformative purpose, it is literally necessary to achieve that
purpose. If Google copied less than the totality of the originals, its search func-
tion could not advise searchers reliably whether their searched term appears in a
book (or how many times).
While Google makes an unauthorized digital copy of the entire book, it does
not reveal that digital copy to the public. The copy is made to enable the search
functions to reveal limited, important information about the books. With respect
to the search function, Google satisfies the third factor test, as illuminated by the
Supreme Court in Campbell.
Google’s provision of snippet view makes our third factor inquiry different
from that inquiry in HathiTrust. What matters in such cases is not so much “the
amount and substantiality of the portion used” in making a copy, but rather the
amount and substantiality of what is thereby made accessible to a public for which it
may serve as a competing substitute. In HathiTrust, notwithstanding the defen-
dant’s full-text copying, the search function revealed virtually nothing of the text
of the originals to the public. Here, through the snippet view, more is revealed to
searchers than in HathiTrust.
Without doubt, enabling searchers to see portions of the copied texts could
have determinative effect on the fair use analysis. The larger the quantity of the
copyrighted text the searcher can see and the more control the searcher can
exercise over what part of the text she sees, the greater the likelihood that those
revelations could serve her as an effective, free substitute for the purchase of the
plaintiff’s book. We nonetheless conclude that, at least as presently structured
by Google, the snippet view does not reveal matter that offers the marketplace a
significantly competing substitute for the copyrighted work.
Google has constructed the snippet feature in a manner that substantially
protects against its serving as an effectively competing substitute for Plaintiffs’
books. In the Background section of this opinion, we describe a variety of limita-
tions Google imposes on the snippet function. . . . The result of these restrictions
157

is, so far as the record demonstrates, that a searcher cannot succeed, even after
long extended effort to multiply what can be revealed, in revealing through a
snippet search what could usefully serve as a competing substitute for the original.
. . . The other restrictions built into the program work together to ensure
that, even after protracted effort over a substantial period of time, only small and
randomly scattered portions of a book will be accessible. In an effort to show what
large portions of text searchers can read through persistently augmented snippet
searches, Plaintiffs’ counsel employed researchers over a period of weeks to do
multiple word searches on Plaintiffs’ books. In no case were they able to access as
much as 16% of the text, and the snippets collected were usually not sequential
but scattered randomly throughout the book. . . .
. . .

D. Factor Four
The fourth fair use factor, “the effect of the [copying] use upon the poten-
tial market for or value of the copyrighted work,” focuses on whether the copy
brings to the marketplace a competing substitute for the original, or its deriva-
tive, so as to deprive the rights holder of significant revenues because of the like-
lihood that potential purchasers may opt to acquire the copy in preference to
the original. Because copyright is a commercial doctrine whose objective is to
stimulate creativity among potential authors by enabling them to earn money
from their creations, the fourth factor is of great importance in making a fair use
assessment. . . .
Campbell stressed the close linkage between the first and fourth factors, in
that the more the copying is done to achieve a purpose that differs from the
purpose of the original, the less likely it is that the copy will serve as a satisfactory
substitute for the original. 510 U.S. at 591. Consistent with that observation, the
HathiTrust court found that the fourth factor favored the defendant and sup-
ported a finding of fair use because the ability to search the text of the book to
determine whether it includes selected words “does not serve as a substitute for
the books that are being searched.” 755 F.3d at 100.
However, Campbell ’s observation as to the likelihood of a secondary use serv-
ing as an effective substitute goes only so far. Even if the purpose of the copying is
for a valuably transformative purpose, such copying might nonetheless harm the
value of the copyrighted original if done in a manner that results in widespread
revelation of sufficiently significant portions of the original as to make available
a significantly competing substitute. The question for us is whether snippet view,
notwithstanding its transformative purpose, does that. We conclude that, at least
as snippet view is presently constructed, it does not.
Especially in view of the fact that the normal purchase price of a book is
relatively low in relation to the cost of manpower needed to secure an arbitrary
assortment of randomly scattered snippets, we conclude that the snippet function
does not give searchers access to effectively competing substitutes. Snippet view,
at best and after a large commitment of manpower, produces discontinuous, tiny
fragments, amounting in the aggregate to no more than 16% of a book. This does
158

not threaten the rights holders with any significant harm to the value of their
copyrights or diminish their harvest of copyright revenue.
We recognize that the snippet function can cause some loss of sales. There
are surely instances in which a searcher’s need for access to a text will be satisfied
by the snippet view, resulting in either the loss of a sale to that searcher, or reduc-
tion of demand on libraries for that title, which might have resulted in libraries
purchasing additional copies. But the possibility, or even the probability or cer-
tainty, of some loss of sales does not suffice to make the copy an effectively com-
peting substitute that would tilt the weighty fourth factor in favor of the rights
holder in the original. There must be a meaningful or significant effect “upon
the potential market for or value of the copyrighted work.” 17 U.S.C. § 107(4).
Furthermore, the type of loss of sale envisioned above will generally occur
in relation to interests that are not protected by the copyright. A snippet’s capac-
ity to satisfy a searcher’s need for access to a copyrighted book will at times be
because the snippet conveys a historical fact that the searcher needs to ascertain.
For example, a student writing a paper on Franklin D. Roosevelt might need to
learn the year Roosevelt was stricken with polio. By entering “Roosevelt polio” in
a Google Books search, the student would be taken to (among numerous sites)
a snippet from page 31 of Richard Thayer Goldberg’s The Making of Franklin D.
Roosevelt (1981), telling that the polio attack occurred in 1921. This would satisfy
the searcher’s need for the book, eliminating any need to purchase it or acquire
it from a library. But what the searcher derived from the snippet was a historical
fact. Author Goldberg’s copyright does not extend to the facts communicated by
his book. It protects only the author’s manner of expression. Hoehling v. Universal
City Studios, Inc., 618 F.2d 972, 974 (2d Cir. 1980) (“A grant of copyright in a pub-
lished work secures for its author a limited monopoly over the expression it con-
tains.”) (emphasis added). Google would be entitled, without infringement of
Goldberg’s copyright, to answer the student’s query about the year Roosevelt was
afflicted, taking the information from Goldberg’s book. The fact that, in the case
of the student’s snippet search, the information came embedded in three lines
of Goldberg’s writing, which were superfluous to the searcher’s needs, would not
change the taking of an unprotected fact into a copyright infringement.
Even if the snippet reveals some authorial expression, because of the brev-
ity of a single snippet and the cumbersome, disjointed, and incomplete nature
of the aggregation of snippets made available through snippet view, we think
it would be a rare case in which the searcher’s interest in the protected aspect of
the author’s work would be satisfied by what is available from snippet view, and
rarer still — because of the cumbersome, disjointed, and incomplete nature of
the aggregation of snippets made available through snippet view — that snippet
view could provide a significant substitute for the purchase of the author’s book.
Accordingly, considering the four fair use factors in light of the goals of copy-
right, we conclude that Google’s making of a complete digital copy of Plaintiffs’
works for the purpose of providing the public with its search and snippet view
functions (at least as snippet view is presently designed) is a fair use and does not
infringe Plaintiffs’ copyrights in their books.
. . .
The judgment of the district court is affirmed.
159

NOTES AND QUESTIONS

1. Parodies as “transformations.”  The Supreme Court’s decision in Campbell


v. Acuff-Rose Music, Inc., 510 U.S. 569 (1994), loomed large in Authors Guild.
Campbell involved a copyright infringement claim by the owner of the song “Oh,
Pretty Woman,” made famous by Roy Orbison, against 2 Live Crew, a popular rap
group, which recorded a parody of the original song. The Court indicated that
many parodies will qualify for fair use protection. The Court held that the extent
to which a defendant’s work is “transformative” would be important for parodic
works. Although acknowledging that transformative use is not absolutely neces-
sary for fair use protection, the Court stated that “the more transformative the
new work, the less will be the significance of other factors, like commercialism,
that may weigh against a finding of fair use.” Id. at 579.
2. Commercial and noncommercial use.  The court notes that while Google’s
status as a for-profit entity is relevant to the fair use analysis, the factor is relatively
unimportant in this dispute. The court mentions that Google wasn’t placing
advertisements next to its search and snippet functions, and that it was provid-
ing search results for “free.” But at the same time Google is a hugely profitable
company, and its book search features presumably functioned as a “loss leader”
to entice people to use other Google features that generate profit for the com-
pany. Given that this factor is part of the statutory fair use framework, should the
court focus on the narrow, less commercial nature of Google’s book database,
or the company’s broader for-profit objectives? Suppose, hypothetically, that a
nonprofit educational institution offered its own book search and snippet view,
but did so in a way that made it more likely that use of the search and snippet fea-
tures would substantially crowd out purchases of the copyrighted works. Would
the nonprofit be in the clear? The Authors Guild court said no, indicating in a
footnote that “[j]ust as there is no reason for presuming that a commercial use
is not a fair use . . . there is likewise no reason to presume categorically that a
nonprofit educational purpose should qualify as a fair use. Authors who write for
educational purposes, and publishers who invest substantial funds to publish edu-
cational materials, would lose the ability to earn revenues if users were permitted
to copy the materials freely merely because such copying was in the service of a
nonprofit educational mission.” 804 F.3d at 219 n.20.
3. Amount and substantiality of portion used.  Recall that §107’s third factor is
“the amount and substantiality of the portion used in relation to the copyrighted
work as a whole.” In applying this factor, does quantity or quality matter? The
answer is both. Courts have used a quantitative approach at times. See, e.g., Iowa
State Univ. Research Found., Inc. v. American Broadcasting Co., 621 F.2d 57 (2d
Cir. 1980) (no fair use where defendant broadcast 8 percent of plaintiff’s film). At
other times, they have focused on qualitative considerations. See, e.g., Meredith
Corp. v. Harper & Row Publishers, Inc., 378 F. Supp. 686 (S.D.N.Y. 1974), aff’d,
500 F.2d 1221 (2d Cir. 1974) (no fair use where material used was particularly
important to copyrighted work as a whole).
4. Countervailing effects on the market.  The Authors Guild court concedes that
the snippet function could cause authors to lose some sales, though it doesn’t
view such losses as significant enough to be dispositive. But it is also likely that
160

the snippet function would generate some new sales for copyright holders. See
Matthew Sag, The Google Book Settlement and the Fair Use Counterfactual, 55
N.Y. L. Sch. L. Rev. 19, 33 (2010). Suppose you realize, thanks to Google’s search-
able database, that a book has material relevant to something you are research-
ing; you then read a well-written and informative snippet, and decide on that
basis to purchase the book. The court didn’t discuss this possibility or try balance
such new sales against lost sales. Should it have done so under § 107?
5. Opting out.  Copyright holders who did not want their books included in
snippet view could fill out an online form, and Google would disable snippet
view for those books. Again, this wasn’t a factor that loomed large in the Authors
Guild court’s analysis, but should the existence of such a straightforward opt-out
mechanism have meant that Google ought to have won this case easily? See id. at
35-36. Consider the same issue in the context of property more broadly. What (if
anything) would be wrong with a regime whereby a person said, “I may walk onto
your land unless you affirmatively fence it off, in which case I will respect your
wishes”? The laws of property and intellectual property usually put the onus on
third parties to obtain the owner’s permission, rather than putting the burden on
owners to assert their rights, with some exceptions like adverse possession. Why?
Should the treatment of real property and intellectual property be symmetrical
in that respect?
6. Fair use facts.  After examining more than 300 published fair use deci-
sions from the federal courts over several decades, Barton Beebe concluded
that in practice, judges generally treat the fair use factors as a balancing test.
They weigh the strength of the justification for the defendant’s use against the
effects of such uses on the plaintiff’s incentives to create. See Barton Beebe, An
Empirical Study of U.S. Copyright Fair Use Opinions, 1978-2005, 156 U. Pa. L.
Rev. 549, 621 (2008). Professor Beebe finds that some aspects of fair use disputes
do correlate with outcomes in published opinions. For example, notwithstand-
ing Authors Guild’s statements about the relatively low importance of factor two,
defendants who asserted fair use rights to factual works were more than twice as
likely to prevail as defendants who asserted fair use rights to non-factual works.
Id. at 611-612.
7. Fair use theory.  In an influential article, Wendy Gordon argued that the
fair use defense should apply when three conditions hold: (1) there is a market
failure, usually stemming from high transaction costs, externalities, or interests
in suppressing uses that the copyright holder does not like; (2) permitting the
defendant to use the copyrighted work is socially desirable; and (3) recognizing
fair use would not substantially diminish copyright holders’ incentives. Wendy J.
Gordon, Fair Use as Market Failure: A Structural and Economic Analysis of the
Betamax Case and Its Predecessors, 82 Colum. L. Rev. 1600, 1614 (1982). A clas-
sic case of fair use is quoting a copyrighted work in a critical book review. Most
authors wouldn’t want to license critical reviews of works they wrote, but society
benefits from literary criticism, and permitting such quotations shouldn’t dimin-
ish the incentives of authors generally to produce quality literary works. Id. at
1633-1635. Does Google’s book search and snippet feature appear to be a fair use
under Professor Gordon’s framework?
b. Patent 161

The patent system is usually thought to be rooted in utilitarian reasons. The


U.S. Constitution supports this view: “[t]o promote the Progress of Science and the
useful Arts. . . .” U.S. Const. art. I, §8. As we indicated earlier (see page 140), patent
law involves a trade-off: It grants a limited monopoly to patentees, thus encouraging
creative and socially useful enterprise. The specific protection that the federal pat-
ent statute grants to the patent holder is the right to prevent others from making,
using, selling (and so on) the patented invention during the term of the patent.
(Note, however, that the patentee’s use of the item or product may be regulated or
even prohibited by law.) Currently, the term of patents is 20 years from the date the
application is filed with the U.S. Patent and Trademark Office (PTO).3
Under the federal Patent Act, 35 U.S.C. §1 et seq., patent applications must
meet five principal requirements in order for the patent to be granted: patent-
ability, novelty, utility, non-obviousness, and enablement.
Patentability means that the invention fits in one of the general categories of
patentable subject matter, namely a “process, machine, manufacture, or any com-
position of matter.” 35 U.S.C. §101. Novelty means that the invention has not been
preceded in identical form in public prior art. (“Prior art” is a patent term that
means relevant knowledge or patents predating the invention at issue.) Utility
is a minimal requirement that is easily met so long as the invention offers some
actual benefit to humans. Non-obviousness is the most important requirement; it
asks whether the invention is a sufficiently big technical advance over the prior
art. Finally, enablement requires that the patent application describe the invention
in sufficient detail that “one of ordinary skill in the art” would be able to use the
invention.
Patent law works on the basis of a registration system. All patents that are
granted are included in a patent registry that anyone can search. The registry
informs other potential inventors and innovators what inventions have been
claimed already and how broad those claims are. It publicizes this information
for several reasons, including to discourage duplicative innovation, to facilitate
patent licensing, and to disseminate information that others might use to make
further breakthroughs. As we will see in Chapter 9, registries exist for real prop-
erty as well, though only some of the aforementioned objectives correspond to
functions of the land registration system.
One of the major controversies in patent law has concerned the scope of
patentable subject matter. Courts have taken an expansive view of the statu-
tory subject matter requirement so that today eligible subject matter includes
genetic materials such as DNA sequences, proteins, and business methods.
Biotechnology-related inventions have been among the most interesting — and
controversial — topics in recent decades.

3. Alternatively, an innovator can decide not to patent an invention, relying on trade secrets law to
protect it instead. This entails a risk-reward tradeoff. Trade secrets law, unlike patent law, grants no monopoly
rights against others who independently come up with the same invention or reverse engineer it. But there is
no temporal limit on the period during which a trade secret can remain protected — it can be monopolized for
as long as the invention is kept secret and retains economic value. Trade secret protection is also available to
innovations that would not constitute patentable subject matter. See David D. Friedman et al., Some Economics
of Trade Secret Law, 5 J. Econ. Persp. 61 (1991).
162

Diamond v. Chakrabarty
Supreme Court of the United States, 1980
447 U.S. 303

Chief Justice Burger delivered the opinion of the Court.


[In 1972, respondent Chakrabarty, a microbiologist, filed a patent applica-
tion related to Chakrabarty’s invention of a human-made, genetically engineered
bacterium capable of breaking down multiple components of crude oil, thus
making it valuable for the treatment of oil spills. Chakrabarty’s claims were of
three types: first, process claims for the method of producing the bacteria; sec-
ond, claims for an inoculum comprised of a carrier material floating on water,
such as straw, and the new bacteria; and third, claims to the bacteria themselves.
The patent examiner allowed the claims falling into the first two categories, but
rejected claims for the bacteria on the grounds that micro-organisms are products
of nature, and that as living things they are not patentable subject matter under
35 U.S.C. §101. The Court of Customs and Patent Appeals eventually reversed
that decision, and the case went to the Supreme Court, which affirmed the appel-
late decision.]
The question before us in this case is a narrow one of statutory interpreta-
tion requiring us to construe 35 U.S.C. §101, which provides: “Whoever invents
or discovers any new and useful process, machine, manufacture, or composition
of matter, or any new and useful improvement thereof, may obtain a patent there-
for, subject to the conditions and requirements of this title.” Specifically, we must
determine whether respondent’s micro-organism constitutes a “manufacture” or
“composition of matter” within the meaning of the statute. . . .
[T]his Court has read the term “manufacture” in §101 in accordance with
its dictionary definition to mean “the production of articles for use from raw or
prepared materials by giving to these materials new forms, qualities, properties,
or combinations, whether by hand-labor or by machinery.” Similarly, “composi-
tion of matter” has been construed consistent with its common usage to include
“all compositions of two or more substances and .  .  . all composite articles,
whether they be the results of chemical union, or of mechanical mixture, or
whether they be gases, fluids, powders or solids.” In choosing such expansive
terms as “manufacture” and “composition of matter,” modified by the compre-
hensive “any,” Congress plainly contemplated that the patent laws would be
given wide scope.
The relevant legislative history also supports a broad construction. The
Patent Act of 1793, authored by Thomas Jefferson, defined statutory subject mat-
ter as “any new and useful art, machine, manufacture, or composition of mat-
ter, or any new or useful improvement [thereof].” The Act embodied Jefferson’s
philosophy that “ingenuity should receive a liberal encouragement.” Subsequent
patent statutes in 1836, 1870 and 1874 employed this same broad language. In
1952, when the patent laws were recodified, Congress replaced the word “art”
with “process,” but otherwise left Jefferson’s language intact. The Committee
Reports accompanying the 1952 Act inform us that Congress intended statutory
subject matter to “include anything under the sun that is made by man.”
163

This is not to suggest that §101 has no limits or that it embraces every dis-
covery. The laws of nature, physical phenomena, and abstract ideas have been
held not patentable. Thus, a new mineral discovered in the earth or a new plant
found in the wild is not patentable subject matter. Likewise, Einstein could not
patent his celebrated law that E=mc2; nor could Newton have patented the law of
gravity. . . .
Judged in this light, respondent’s micro-organism plainly qualifies as patent-
able subject matter. His claim is not to a hitherto unknown natural phenomenon,
but to a nonnaturally occurring manufacture or composition of matter — a prod-
uct of human ingenuity. . . . [T]he patentee has produced a new bacterium with
markedly different characteristics from any found in nature and one having the
potential for significant utility. His discovery is not nature’s handiwork, but his
own; accordingly it is patentable subject matter under §101. . . .
Two contrary arguments are advanced, neither of which we find persua-
sive. . . . The petitioner’s first argument rests on the enactment of the 1930 Plant
Patent Act, which afforded patent protection to certain asexually reproduced
plants, and the 1970 Plant Variety Protection Act, which authorized protection
for certain sexually reproduced plants but excluded bacteria from its protec-
tion. In the petitioner’s view, the passage of these Acts evidences congressional
understanding that the terms “manufacture” or “composition of matter” do not
include living things; if they did, the petitioner argues, neither Act would have
been necessary.
We reject this argument. Prior to 1930, two factors were thought to remove
plants from patent protection. The first was the belief that plants, even those arti-
ficially bred, were products of nature for purposes of the patent law. . . . The sec-
ond obstacle to patent protection for plants was the fact that plants were thought
not amenable to the “written description” requirement of the patent law. See 35
U.S.C. §112. Because new plants may differ from old only in color or perfume,
differentiation by written description was often impossible. . . .
In enacting the Plant Patent Act, Congress addressed both of these con-
cerns. It explained at length its belief that the work of the plant breeder “in aid
of nature” was patentable invention. S. Rep. No. 315, 71st Cong., 2d Sess., 6-8
(1930); H.R. Rep. No. 1129, 71st Cong., 2d Sess., 7-9 (1930). And it relaxed the
written description requirement in favor of “a description . . . as complete as is
reasonably possible.” 35 U.S.C. §162. No Committee or Member of Congress,
however, expressed the broader view, now urged by the petitioner, that the terms
“manufacture” or “composition of matter” exclude living things. . . .
Congress thus recognized that the relevant distinction was not between liv-
ing and inanimate things, but between products of nature, whether living or not,
and human-made inventions. Here, respondent’s micro-organism is the result
of human ingenuity and research. Hence, the passage of the Plant Patent Act
affords the Government no support. . . .
The petitioner’s second argument is that micro-organisms cannot qualify as
patentable subject matter until Congress expressly authorizes such protection. His
position rests on the fact that genetic technology was unforeseen when Congress
enacted §101. From this it is argued that resolution of the patentability of inven-
tions such as respondent’s should be left to Congress. The legislative process, the
164

petitioner argues, is best equipped to weigh the competing economic, social, and
scientific considerations involved, and to determine whether living organisms
produced by genetic engineering should receive patent protection. In support
of this position, the petitioner relies on our recent holding in Parker v. Flook,
437 U.S. 584 (1978), and the statement that the judiciary “must proceed cau-
tiously when . . . asked to extend patent rights into areas wholly unforeseen by
Congress.” Id. at 596.
It is, of course, correct that Congress, not the courts, must define the limits
of patentability; but it is equally true that once Congress has spoken it is “the
province and duty of the judicial department to say what the law is.” Marbury v.
Madison, 1 Cranch 137 (1803). Congress has performed its constitutional role in
defining patentable subject matter in §101; we perform ours in construing the
language Congress has employed. In so doing, our obligation is to take statutes as
we find them, guided, if ambiguity appears, by the legislative history and statutory
purpose. Here, we perceive no ambiguity. The subject-matter provisions of the
patent law have been cast in broad terms to fulfill the constitutional and statu-
tory goal of promoting “the Progress of Science and the useful Arts” with all that
means for the social and economic benefits envisioned by Jefferson. Broad gen-
eral language is not necessarily ambiguous when congressional objectives require
broad terms.
Nothing in Flook is to the contrary. That case applied our prior precedents to
determine that a “claim for an improved method of calculation, even when tied
to a specific end use, is unpatentable subject matter under §101.” 437 U.S. at 595,
n.18. The Court carefully scrutinized the claim at issue to determine whether it
was precluded from patent protection under “the principles underlying the pro-
hibition against patents for ‘ideas’ or phenomena of nature.” Id. at 593. We have
done that here. Flook did not announce a new principle that inventions in areas
not contemplated by Congress when the patent laws were enacted are unpatent-
able per se.
To read that concept into Flook would frustrate the purposes of the patent
law. This Court frequently has observed that a statute is not to be confined to the
“particular application[s] .  .  . contemplated by the legislators.” Barr v. United
States, 324 U.S. 83, 90 (1945). . . . This is especially true in the field of patent law.
A rule that unanticipated inventions are without protection would conflict with
the core concept of the patent law that anticipation undermines patentability. . . .
Congress employed broad general language in drafting §101 precisely because
such inventions are often unforeseeable.
To buttress his argument, the petitioner, with support of amicus, points to
grave risks that may be generated by research endeavors such as respondent’s.
The briefs present a gruesome parade of horribles. Scientists, among them Nobel
laureates, are quoted suggesting that genetic research may pose a serious threat
to the human race, or, at the very least, that the dangers are far too substantial
to permit such research to proceed apace at this time. We are told that genetic
research and related technological developments may spread pollution and dis-
ease, that it may result in a loss of genetic diversity, and that its practice may
tend to depreciate the value of human life. These arguments are forcefully, even
165

passionately, presented; they remind us that, at times, human ingenuity seems


unable to control fully the forces it creates — that, with Hamlet, it is sometimes
better “to bear those ills we have than fly to others that we know not of.”
It is argued that this Court should weigh these potential hazards in consider-
ing whether respondent’s invention is patentable subject matter under §101. We
disagree. The grant or denial of patents on micro-organisms is not likely to put
an end to genetic research or to its attendant risks. The large amount of research
that has already occurred when no researcher had sure knowledge that patent
protection would be available suggests that legislative or judicial fiat as to pat-
entability will not deter the scientific mind from probing into the unknown any
more than Canute could command the tides. Whether respondent’s claims are
patentable may determine whether research efforts are accelerated by the hope
of reward or slowed by want of incentives, but that is all.
What is more important is that we are without competence to entertain
these arguments — either to brush them aside as fantasies generated by fear of
the unknown, or to act on them. The choice we are urged to make is a matter
of high policy for resolution within the legislative process after the kind of inves-
tigation, examination, and study that legislative bodies can provide and courts
cannot.

Justice Brennan, with whom Justice White, Justice Marshall, and Justice Powell
join, dissenting.
. . . The patent laws attempt to reconcile this Nation’s deep seated antipathy
to monopolies with the need to encourage progress. . . . Given the complexity
and legislative nature of this delicate task, we must be careful to extend patent
protection no further than Congress has provided. In particular, were there an
absence of legislative direction, the courts should leave to Congress the decisions
whether and how far to extend the patent privilege into areas where the common
understanding has been that patents are not available.
In this case, however, we do not confront a complete legislative vacuum. The
sweeping language of the Patent Act of 1793, as re-enacted in 1952, is not the last
pronouncement Congress has made in this area. In 1930 Congress enacted the
Plant Patent Act affording patent protection to developers of certain asexually
reproduced plants. In 1970 Congress enacted the Plant Variety Protection Act to
extend protection to certain new plant varieties capable of sexual reproduction.
Thus, we are not dealing — as the Court would have it — with the routine prob-
lem of “unanticipated inventions.” . . . In these two Acts Congress has addressed
the general problem of patenting animate inventions and has chosen carefully
limited language granting protection to some kinds of discoveries, but specifi-
cally excluding others. These Acts strongly evidence a congressional limitation
that excludes bacteria from patentability.
The Acts evidence Congress’ understanding, at least since 1930, that §101
does not include living organisms. If newly developed living organisms not natu-
rally occurring had been patentable under §101, the plants included in the scope
of the 1930 and 1970 Acts could have been patented without new legislation.
Those plants, like the bacteria involved in this case, were new varieties not natu-
rally occurring. . . . I cannot share the Court’s implicit assumption that Congress
166

was engaged in either idle exercises or mere correction of the public record
when it enacted the 1930 and 1970 Acts. . . . Because Congress thought it had to
legislate in order to make agricultural “human-made inventions” patentable and
because the legislation Congress enacted is limited, it follows that Congress never
meant to make items outside the scope of the legislation patentable. . . .
Congress plainly has legislated in the belief that §101 does not encompass
living organisms. It is the role of Congress, not this Court, to broaden or narrow
the reach of the patent laws. This is especially true where, as here, the composi-
tion sought to be patented uniquely implicates matters of public concern.

POSTSCRIPT
The patent on Dr. Chakrabarty’s invention was finally issued in March
1981. In the meantime, General Electric, which owned the patent, had
announced that new techniques had made Chakrabarty’s invention obso-
lete and that the company had no plans to develop his method.

NOTES AND QUESTIONS

1. Chakrabarty and the then-nascent biotechnology industry.  Chakrabarty is


important, among other reasons, because it provided a significant boost to the
biotechnology industry, which was then in its nascent stage. In holding that a liv-
ing, genetically altered microorganism constituted a patentable subject matter,
the Supreme Court opened the door to subsequent waves of patent applications
involving rapid advances in biotechnology. Prior to Chakrabarty, the patentability
of genetically engineered organisms had seemed doubtful because of the long-
established exclusion for “products of nature.” See Funk Bros. Seed Co. v. Kalo
Inoculant Co., 333 U.S. 127 (1948). Chakrabarty put those doubts to rest.
2. After Chakrabarty, what counts as a “product of nature”? The Supreme Court
addressed that issue in Association for Molecular Pathology v. Myriad Genetics,
Inc., 569 U.S. 576 133 S. Ct. 2107 (2013). Myriad discovered genetic mutations
that were associated with substantially elevated risks of breast and ovarian cancers.
Myriad then obtained patents on the DNA sequences whose presence indicated
a heightened cancer risk. The Court held that isolating a sequence that already
existed in human DNA did not satisfy Chakrabarty’s requirements. “In Chakrabarty,
scientists added four plasmids to a bacterium, which enabled it to break down
various components of crude oil. . . . In this case, by contrast, Myriad did not cre-
ate anything. To be sure, it found an important and useful gene, but separating
that gene from its surrounding genetic material is not an act of invention.” 133 S.
Ct. at 2117. Myriad was not a total defeat for its namesake, though. Coding exons
and adjacent non-coding introns combine to form human DNA, and Myriad also
had removed the introns from naturally occurring DNA sequences, resulting in
cDNA sequences that do not appear naturally in the human body. The Court held
that such cDNA could be patented: “[T]he lab technician unquestionably creates
167

something new when cDNA is made. cDNA retains the naturally occurring exons
of DNA, but it is distinct from the DNA from which it was derived.” 133 S. Ct. at
2119. In a footnote, the Court mentioned that inventors seeking to patent cDNA
would still need to establish other elements of patentability such as novelty, non-
obviousness, and enablement. 133 S. Ct. at 2119 n.9.
3. Institutional competence.  The majority and dissent agree that whether liv-
ing things can be patented is the sort of difficult philosophical and economic
question that should be decided by Congress, not the courts. But the justices have
differing assessments of what follows from that assumption. If the courts wish
to maximize the likelihood of serious congressional investigation into a novel
and important issue in property law or intellectual property law, what should
they do? Should they recognize the ambiguous property right, as the majority
did, or refuse to recognize such a right, as the dissent urged? Is the legislature
more likely to create a property right that a court said was nonexistent under an
existing statute or to abrogate a property right that the court said already exists?
Constitutional provisions discussed in Chapter 13 also may affect the calculus.

2. Property in One’s Person

Remember the foundation of Locke’s labor theory of property, stated on page 15:
“every man has a property in his own person.” Slavery, obviously, was in opposition
to that proposition, but slavery has been abolished. So, can we now say, without
qualification, that you have property in yourself? Consider the following case.

Moore v. Regents of the University of California


Supreme Court of California, 1990
793 P.2d 479

[Background: In 1976 John Moore sought treatment for hairy-cell leukemia at the
Medical Center of the University of California, Los Angeles. (We shall at times
refer to the doctors at the Center and to the Regents of the University who own
the Center collectively as “defendants.”) The defendants conducted tests, took
blood and tissue samples, confirmed the diagnosis, and told Moore that his con-
dition was life-threatening and that his spleen should be removed. What they did
not tell Moore was that his cells were unique and that access to them was of great
scientific and commercial value.
Moore consented to the splenectomy and to some seven years of follow-up
tests and procedures that he was led to believe were important to his treatment.
His spleen was retained for research purposes without his knowledge or consent,
and during the post-operative period samples of tissue and blood and other fluids
were taken on each of Moore’s visits. At some point Moore was informed that his
bodily substances were being used for research, but he was never informed of the
commercial value of the research or of the defendants’ financial interest in it.
The defendants subsequently established a cell line from Moore’s cells (named
168

the Mo cell line, after Moore), received a patent for it, and entered into various
commercial agreements. Hundreds of thousands of dollars had been paid to the
defendants under these agreements by the mid-1980s, and the potential market
for products from Moore’s cell line is estimated to run into the billions of dollars.
Moore sued for damages in 1984, his complaint stating a number of causes
of action, including conversion (wrongful exercise of ownership rights over the
personal property of another; Moore alleged that his blood and bodily substances,
and the cell line derived from them, were “his tangible personal property”), lack
of informed consent, breach of fiduciary duty, fraud and deceit, unjust enrich-
ment, intentional infliction of emotional distress, negligent misrepresentation,
and others. The trial court sustained the defendants’ demurrers to the conver-
sion cause of action and held that because the conversion cause of action was
incorporated into all the other causes of action, those too were defective.
The court of appeal reversed, finding that Moore had adequately stated a
cause of action for conversion. Moore v. Regents of the University of California,
249 Cal. Rptr. 494 (Cal. App. 1988). The court could find “no legal authority,
public policy, nor universally known facts of biological science . . . which com-
pel a conclusion that this plaintiff cannot have a sufficient legal interest in his
own bodily tissues amounting to personal property. Absent plaintiff’s consent to
defendants’ disposition of the tissues, or lawful justification, such as abandon-
ment, the complaint adequately pleads all the elements of a cause of action for
conversion.”
“We have approached this issue with caution,” the court said. “The evolu-
tion of civilization from slavery to freedom, from regarding people as chattels
to recognition of the individual dignity of each person, necessitates prudence
in attributing the qualities of property to human tissue. There is, however, a dra-
matic difference between having property rights in one’s own body and being the
property of another. . . . We are not called on to determine whether use of human
tissue or body parts ought to be ‘gift based’ or subject to a ‘free market.’ That
question of policy must be determined by the Legislature. In the instant case, the
cell line has already been commercialized by defendants. We are presented a fait
accompli, leaving only the question of who shares in the proceeds. . . .”
The court then considered the meaning of property and concluded that the
essential element is dominion, or rights of use, control, and disposition. It went
on to discuss the “many cases” (involving search and seizure, consent to medical
procedures, rights to dead bodies, and other instances) that recognize “rights of
dominion over one’s own body, and the interests one has therein. . . . These rights
and interests are so akin to property interests that it would be a subterfuge to call
them something else.”
The court concluded by dealing with a series of contentions by defendants.
There were no grounds to infer that Moore had abandoned his tissue or con-
sented to its use in research unrelated to his treatment. And the fact that the
defendants’ skill and effort had enhanced the value of Moore’s tissue went not
to the issue of conversion but to the measure of damages for the conversion.
“Plaintiff’s cells and genes are a part of his person,” the court said. To hold that
patients do not have the ultimate power to control the destiny of their tissues
169

“would open the door to a massive invasion of human privacy and dignity in
the name of medical progress.” The court saw no reason to believe that medi-
cal research would suffer by requiring the consent of the donor of tissue before
it can be appropriated. True, a potential donor, once informed, might refuse
consent, but the court “would give the patient that right. As to defendants’ con-
cern that a patient might seek the greatest economic gain for his participation,
this argument is unpersuasive because it fails to explain why defendants . . . are
any more to be trusted with these momentous decisions than the person whose
cells are being used.” If giving patients a financial interest in their tissues inhib-
ited donations and increased the costs of medical care, that problem could be
addressed by the legislature.
Upon petition by the defendants, the court of appeal’s judgment was
reviewed by the California Supreme Court. The case takes up 65 pages of the offi-
cial reporter; what follows is the essence of the views stated, particularly regarding
the cause of action for conversion.]

Panelli, J. We granted review in this case to determine whether plaintiff has stated
a cause of action against his physician and other defendants for using his cells in
potentially lucrative medical research without his permission. . . . We hold that
the complaint states a cause of action for breach of the physician’s disclosure
obligations, but not for conversion. . . .

A. Breach of Fiduciary Duty and Lack of Informed Consent


Moore repeatedly alleges that Golde [the attending physician] failed to dis-
close the extent of his research and economic interests in Moore’s cells before
obtaining consent to the medical procedures by which the cells were extracted.
These allegations, in our view, state a cause of action against Golde for invading
a legally protected interest of his patient. This cause of action can properly be
characterized either as the breach of a fiduciary duty to disclose facts material to
the patient’s consent or, alternatively, as the performance of medical procedures
without first having obtained the patient’s informed consent. . . .

B. Conversion
Moore also attempts to characterize the invasion of his rights as a conver-
sion — a tort that protects against interference with possessory and ownership
interests in personal property. He theorizes that he continued to own his cells
following their removal from his body, at least for the purpose of directing their
use, and that he never consented to their use in potentially lucrative medical
research. . . . As a result of the alleged conversion, Moore claims a proprietary
interest in each of the products that any of the defendants might ever create from
his cells or the patented cell line.
No court, however, has ever in a reported decision imposed conversion lia-
bility for the use of human cells in medical research. While that fact does not end
our inquiry, it raises a flag of caution. In effect, what Moore is asking us to do is
to impose a tort duty on scientists to investigate the consensual pedigree of each
170

human cell sample used in research. To impose such a duty, which would affect
medical research of importance to all of society, implicates policy concerns far
removed from the traditional, two-party ownership disputes in which the law of
conversion arose. . . .
[W]e first consider whether the tort of conversion clearly gives Moore a
cause of action under existing law. We do not believe it does. . . .
Since Moore clearly did not expect to retain possession of his cells following
their removal, to sue for their conversion he must have retained an ownership
interest in them. But there are several reasons to doubt that he did retain any
such interest. First, no reported judicial decision supports Moore’s claim, either
directly or by close analogy. Second, California statutory law drastically limits any
continuing interest of a patient in excised cells. Third, the subject matters of the
Regents’ patent — the patented cell line and the products derived from it — can-
not be Moore’s property.
Neither the Court of Appeal’s opinion, the parties’ briefs, nor our research
discloses a case holding that a person retains a sufficient interest in excised cells
to support a cause of action for conversion. We do not find this surprising, since
the laws governing such things as human tissues, transplantable organs, blood,
fetuses, pituitary glands, corneal tissue, and dead bodies deal with human biologi-
cal materials as objects sui generis, regulating their disposition to achieve policy
goals rather than abandoning them to the general law of personal property. . . .
. . . [T]he Court of Appeal in this case concluded that “[a] patient must have
the ultimate power to control what becomes of his or her tissues. To hold other-
wise would open the door to a massive invasion of human privacy and dignity in
the name of medical progress.” Yet one may earnestly wish to protect privacy and
dignity without accepting the extremely problematic conclusion that interference
with those interests amounts to a conversion of personal property. Nor is it nec-
essary to force the round pegs of “privacy” and “dignity” into the square hole of
“property” in order to protect the patient, since the fiduciary-duty and informed-
consent theories protect these interests directly by requiring full disclosure.
The next consideration that makes Moore’s claim of ownership problematic
is California statutory law, which drastically limits a patient’s control over excised
cells. Pursuant to Health and Safety Code section 7054.4, “[n]otwithstanding any
other provision of law, recognizable anatomical parts, human tissues, anatomical
human remains, or infectious waste following conclusion of scientific use shall
be disposed of by interment, incineration, or any other method determined by
the state department [of health services] to protect the public health and safety.”
Clearly the Legislature did not specifically intend this statute to resolve the ques-
tion of whether a patient is entitled to compensation for the nonconsensual use
of excised cells. A primary object of the statute is to ensure the safe handling of
potentially hazardous biological waste materials. Yet one cannot escape the con-
clusion that the statute’s practical effect is to limit, drastically, a patient’s control
over excised cells. By restricting how excised cells may be used and requiring
their eventual destruction, the statute eliminates so many of the rights ordinarily
attached to property that one cannot simply assume that what is left amounts to
“property” or “ownership” for purposes of conversion law. . . .
171

Finally, the subject matter of the Regents’ patent — the patented cell line and
the products derived from it — cannot be Moore’s property. This is because the
patented cell line is both factually and legally distinct from the cells taken from
Moore’s body. Federal law permits the patenting of organisms that represent the
product of “human ingenuity,” but not naturally occurring organisms. . . . It is
this inventive effort that patent law rewards, not the discovery of naturally occur-
ring raw materials. Thus, Moore’s allegations that he owns the cell line and the
products derived from it are inconsistent with the patent, which constitutes an
authoritative determination that the cell line is the product of invention. . . .
[Having concluded that Moore’s claim found no support under the existing
law of conversion, the majority considered whether the law of conversion should
be extended to allow the claim.]
. . . There are three reasons why it is inappropriate to impose liability for
conversion based upon the allegations of Moore’s complaint. First, a fair bal-
ancing of the relevant policy considerations counsels against extending the tort.
Second, problems in this area are better suited to legislative resolution. Third,
the tort of conversion is not necessary to protect patients’ rights. For these rea-
sons, we conclude that the use of excised human cells in medical research does
not amount to a conversion.
Of the relevant policy considerations, two are of overriding importance. The
first is protection of a competent patient’s right to make autonomous medical
decisions. . . . The second important policy consideration is that we not threaten
with disabling civil liability innocent parties who are engaged in socially useful
activities, such as researchers who have no reason to believe that their use of a
particular cell sample is, or may be, against a donor’s wishes. . . .
Indeed, so significant is the potential obstacle to research stemming from
uncertainty about legal title to biological materials that the Office of Technology
Assessment reached this striking conclusion: “[R]egardless of the merit of claims
by the different interested parties, resolving the current uncertainty may be
more important to the future of biotechnology than resolving it in any particu-
lar way.” . . .
We need not, however, make an arbitrary choice between liability and nonli-
ability. Instead, an examination of the relevant policy considerations suggests an
appropriate balance: Liability based upon existing disclosure obligations, rather
than an unprecedented extension of the conversion theory, protects patients’
rights of privacy and autonomy without unnecessarily hindering research.
To be sure, the threat of liability for conversion might help to enforce
patients’ rights indirectly. This is because physicians might be able to avoid liability
by obtaining patients’ consent, in the broadest possible terms, to any conceivable
subsequent research use of excised cells. Unfortunately, to extend the conversion
theory would utterly sacrifice the other goal of protecting innocent parties. Since
conversion is a strict liability tort, it would impose liability on all those into whose
hands the cells come, whether or not the particular defendant participated in,
or knew of, the inadequate disclosures that violated the patient’s right to make
an informed decision. In contrast to the conversion theory, the fiduciary-duty
and informed-consent theories protect the patient directly, without punishing
172

innocent parties or creating disincentives to the conduct of socially beneficial


research.
Research on human cells plays a critical role in medical research. This is so
because researchers are increasingly able to isolate naturally occurring, medi-
cally useful biological substances and to produce useful quantities of such sub-
stances through genetic engineering. . . . The extension of conversion law into
this area will hinder research by restricting access to the necessary raw materials.
Thousands of human cell lines already exist in tissue repositories. . . . At present,
human cell lines are routinely copied and distributed to other researchers for
experimental purposes, usually free of charge. This exchange of scientific materi-
als, which still is relatively free and efficient, will surely be compromised if each
cell sample becomes the potential subject matter of a lawsuit.
To expand liability by extending conversion law into this area would have a
broad impact. The House Committee on Science and Technology of the United
States Congress found that “49 percent of the researchers at medical institutions
surveyed used human tissues or cells in their research.” . . . In addition, “there are
nearly 350 commercial biotechnology firms in the United States actively engaged in
biotechnology research and commercial product development and approximately
25 to 30 percent appear to be engaged in research to develop a human therapeutic
or diagnostic reagent. . . . Most, but not all, of the human therapeutic products are
derived from human tissues and cells, or human cell lines or cloned genes.” . . .
In deciding whether to create new tort duties we have in the past considered
the impact that expanded liability would have on activities that are important to
society, such as research. . . .
[T]he theory of liability that Moore urges us to endorse threatens to destroy
the economic incentive to conduct important medical research. If the use of cells
in research is a conversion, then with every cell sample a researcher purchases
a ticket in a litigation lottery. Because liability for conversion is predicated on a
continuing ownership interest, “companies are unlikely to invest heavily in devel-
oping, manufacturing, or marketing a product when uncertainty about clear title
exists.” . . .
If the scientific users of human cells are to be held liable for failing to inves-
tigate the consensual pedigree of their raw materials, we believe the Legislature
should make that decision. Complex policy choices affecting all society are
involved, and [l]egislatures, in making such policy decisions, have the ability
to gather empirical evidence, solicit the advice of experts, and hold hearings at
which all interested parties present evidence and express their views. . . .
[T]here is no pressing need to impose a judicially created rule of strict liabil-
ity, since enforcement of physicians’ disclosure obligations will protect patients
against the very type of harm with which Moore was threatened. So long as a phy-
sician discloses research and economic interests that may affect his judgment, the
patient is protected from conflicts of interest. Aware of any conflicts, the patient
can make an informed decision to consent to treatment, or to withhold consent
and look elsewhere for medical assistance. As already discussed, enforcement of
physicians’ disclosure obligations protects patients directly, without hindering
the socially useful activities of innocent researchers.
173

For these reasons, we hold that the allegations of Moore’s third amended
complaint state a cause of action for breach of fiduciary duty or lack of informed
consent, but not conversion. . . .
Lucas, C.J., Eagleson, J., and Kennard, J., concurred.

Arabian, J., concurring. I join in the views cogently expounded by the majority.
I write separately to give voice to a concern that I believe informs much of that
opinion but finds little or no expression therein. I speak of the moral issue.
Plaintiff has asked us to recognize and enforce a right to sell one’s own
body tissue for profit. He entreats us to regard the human vessel — the single most
venerated and protected subject in any civilized society — as equal with the basest
commercial commodity. He urges us to commingle the sacred with the profane.
He asks much. . . .
It is true, that this court has not often been deterred from deciding difficult
legal issues simply because they require a choice between competing social or eco-
nomic policies. . . . The difference here, however, lies in the nature of the conflict-
ing moral, philosophical and even religious values at stake, and in the profound
implications of the position urged. The ramifications of recognizing and enforc-
ing a property interest in body tissues are not known, but are greatly feared — the
effect on human dignity of a marketplace in human body parts, the impact on
research and development of competitive bidding for such materials, and the
exposure of researchers to potentially limitless and uncharted tort liability. . . .
Whether, as plaintiff urges, his cells should be treated as property suscep-
tible to conversion is not, in my view, ours to decide. . . .
Where then shall a complete resolution be found? Clearly the Legislature,
as the majority opinion suggests, is the proper deliberative forum. . . . Indeed, a
legislative response creating a licensing scheme, which establishes a fixed rate of
profit sharing between researcher and subject, has already been suggested. Such
an arrangement would not only avoid the moral and philosophical objections to
a free market operation in body tissue, but would also address stated concerns by
eliminating the inherently coercive effect of a waiver system and by compensating
donors regardless of temporal circumstances. . . .
[The concurring and dissenting opinion of Justice Broussard is omitted.]

Mosk, J. I dissent. Contrary to the principal holding of the Court of Appeal, the
majority conclude that the complaint does not — in fact cannot — state a cause of
action for conversion. I disagree with this conclusion for all the reasons stated by
the Court of Appeal, and for additional reasons. . . .
The concepts of property and ownership in our law are extremely broad. . . .
Being broad, the concept of property is also abstract: rather than referring
directly to a material object such as a parcel of land or the tractor that cultivates
it, the concept of property is often said to refer to a “bundle of rights” that may be
exercised with respect to that object — principally the rights to possess the prop-
erty, to use the property, to exclude others from the property, and to dispose of
the property by sale or by gift. . . . But the same bundle of rights does not attach
to all forms of property. For a variety of policy reasons, the law limits or even for-
bids the exercise of certain rights over certain forms of property. For example,
174

both law and contract may limit the right of an owner of real property to use his
parcel as he sees fit. Owners of various forms of personal property may likewise
be subject to restrictions on the time, place, and manner of their use. Limitations
on the disposition of real property, while less common, may also be imposed.
Finally, some types of personal property may be sold but not given away,4 while
others may be given away but not sold,5 and still others may neither be given away
nor sold.6
In each of the foregoing instances, the limitation or prohibition diminishes
the bundle of rights that would otherwise attach to the property, yet what remains
is still deemed in law to be a protectible property interest.  .  .  . The same rule
applies to Moore’s interest in his own body tissue. . . . Above all, at the time of its
excision he at least had the right to do with his own tissue whatever the defendants did
with it: i.e., he could have contracted with researchers and pharmaceutical com-
panies to develop and exploit the vast commercial potential of his tissue and its
products. . . .
Having concluded — mistakenly, in my view — that Moore has no cause of
action for conversion under existing law, the majority next consider whether to
“extend” the conversion cause of action to this context. Again . . . I respectfully
disagree with [their reasoning].
.  .  . [O]ur society acknowledges a profound ethical imperative to respect
the human body as the physical and temporal expression of the unique human
persona. One manifestation of that respect is our prohibition against direct abuse
of the body by torture or other forms of cruel or unusual punishment. Another
is our prohibition against indirect abuse of the body by its economic exploitation
for the sole benefit of another person. The most abhorrent form of such exploi-
tation, of course, was the institution of slavery. Lesser forms, such as indentured
servitude or even debtor’s prison, have also disappeared. Yet their specter haunts
the laboratories and boardrooms of today’s biotechnological research-industrial
complex. It arises wherever scientists or industrialists claim, as defendants claim
here, the right to appropriate and exploit a patient’s tissue for their sole eco-
nomic benefit — the right, in other words, to freely mine or harvest valuable phys-
ical properties of the patient’s body. . . .
A second policy consideration adds notions of equity to those of ethics. Our
society values fundamental fairness in dealings between its members, and con-
demns the unjust enrichment of any member at the expense of another. This
is particularly true when, as here, the parties are not in equal bargaining posi-
tions. . . . Yet defendants deny that Moore is entitled to any share whatever in the
proceeds of this cell line. This is both inequitable and immoral. . . .
There will be . . . equitable sharing if the courts recognize that the patient has
a legally protected property interest in his own body and its products: “property

4. A person contemplating bankruptcy may sell his property at its “reasonably equivalent value,” but he
may not make a gift of the same property.
5. A sportsman may give away wild fish or game that he has caught or killed pursuant to his license, but
he may not sell it.
The transfer of human organs and blood is a special case discussed below.
6. E.g., a license to practice a profession, or a prescription drug in the hands of the person for whom it
is prescribed.
175

rights in one’s own tissue would provide a morally acceptable result by giving
effect to notions of fairness and preventing unjust enrichment. . . .”
I do not doubt that the Legislature is competent to act on this topic. The
fact that the Legislature may intervene if and when it chooses, however, does not
in the meanwhile relieve the courts of their duty of enforcing — or if need be,
fashioning — an effective judicial remedy for the wrong here alleged. . . .
The inference I draw from the current statutory regulation of human bio-
logical materials, moreover, is the opposite of that drawn by the majority. By selec-
tive quotation of the statutes the majority seem to suggest that human organs
and blood cannot legally be sold on the open market — thereby implying that if
the Legislature were to act here it would impose a similar ban on monetary com-
pensation for the use of human tissue in biotechnological research and develop-
ment. But if that is the argument, the premise is unsound: contrary to popular
misconception, it is not true that human organs and blood cannot legally be sold.
As to organs, the majority rely on the Uniform Anatomical Gift Act (Health
& Saf. Code, §7150 et seq., hereafter the UAGA) for the proposition that a com-
petent adult may make a post mortem gift of any part of his body but may not
receive “valuable consideration” for the transfer. But the prohibition of the
UAGA against the sale of a body part is much more limited than the majority
recognize: by its terms the prohibition applies only to sales for “transplantation”
or “therapy.” Yet a different section of the UAGA authorizes the transfer and
receipt of body parts for such additional purposes as “medical or dental educa-
tion, research, or advancement of medical or dental science. No section of the
UAGA prohibits anyone from selling body parts for any of those additional pur-
poses; by clear implication, therefore, such sales are legal. Indeed, the fact that
the UAGA prohibits no sales of organs other than sales for “transplantation” or
“therapy” raises a further implication that it is also legal for anyone to sell human
tissue to a biotechnology company for research and development purposes. . . .
The majority’s final reason for refusing to recognize a conversion cause of
action on these facts is that “there is no pressing need” to do so because the
complaint also states another cause of action that is assertedly adequate to the
task. . . .
I disagree, however, with the majority’s further conclusion that in the pres-
ent context a nondisclosure cause of action is an adequate — in fact, a supe-
rior — substitute for a conversion cause of action. . . .
The majority do not spell out how those obligations will be “enforced”; but
because they arise from judicial decision (the majority opinion herein) rather
than from legislative or administrative enactment, we may infer that the obliga-
tions will primarily be enforced by the traditional judicial remedy of an action for
damages for their breach. . . .
The remedy is largely illusory. “[A]n action based on the physician’s fail-
ure to disclose material information sounds in negligence. As a practical matter,
however, it may be difficult to recover on this kind of negligence theory because
the patient must prove a causal connection between his or her injury and the physi-
cian’s failure to inform.” (Martin & Lagod, Biotechnology and the Commercial
Use of Human Cells: Toward an Organic View of Life and Technology (1989),
5 Santa Clara Computer & High Tech L.J. 211, 222, fn. omitted, italics added.)
176

There are two barriers to recovery. First, “the patient must show that if he or she
had been informed of all pertinent information, he or she would have declined
to consent to the procedure in question.” (Id.) . . .
The second barrier to recovery is still higher, and is erected on the first: it is
not even enough for the plaintiff to prove that he personally would have refused
consent to the proposed treatment if he had been fully informed; he must also
prove that in the same circumstances no reasonably prudent person would have given
such consent. . . .
The second reason why the nondisclosure cause of action is inadequate for
the task that the majority assign to it is that it fails to solve half the problem before
us: it gives the patient only the right to refuse consent, i.e., the right to prohibit the
commercialization of his tissue; it does not give him the right to grant consent to
that commercialization on the condition that he share in its proceeds. . . .
Third, the nondisclosure cause of action fails to reach a major class of poten-
tial defendants: all those who are outside the strict physician-patient relationship
with the plaintiff. Thus the majority concede that here only defendant Golde, the
treating physician, can be directly liable to Moore on a nondisclosure cause of
action. . . .

POSTSCRIPT
After losing on his conversion claim, Moore eventually resolved his remain-
ing claims in a confidential settlement. Whatever amount he received,
much of it probably went to pay attorneys’ fees. Moore became an advocate
for patients’ rights. In 2001, his battle with cancer ended when he died at
the age of 56.

NOTES AND QUESTIONS

1. Another story.  “Doctors took her cells without asking. Those cells never
died. They launched a medical revolution and a multimillion-dollar industry. More
than twenty years later her children found out.” So says the dust jacket of Rebecca
Skloot’s best-selling book, The Immortal Life of Henrietta Lacks (2010). Ms. Lacks
died of cervical cancer in 1951; she was 31 years old. Shortly before her death, and
without her knowledge or consent, doctors took some of her tumor cells. The cells
(named HeLa cells) were able to live on in a laboratory, something that had never
happened before; they have since been used in thousands of studies around the
world. The research “yielded profound insights into cell biology, vaccines, in vitro
fertilization and cancer.” The Lacks family knew nothing of this until 1973, after
which some of them began a long search for more information, the culmination
of which is an August 2013 agreement with the National Institutes of Health that
responds to the family’s central concerns — privacy, and some sense of control over
the use of data. Under the agreement, researchers will have to apply for access to
the data and must submit annual reports about their studies. Two members of the
177

Lacks family will be part of the N.I.H. working group that reviews applications. The
agreement does not provide the family with proceeds from any commercial prod-
ucts developed from research on the HeLa cells. Carl Zimmer, Family Gets Role in
Use of “Immortal Life” Cells, N.Y. Times, Aug. 8, 2013, at A1.
2. A bundle of rights.  In his concurring opinion, Justice Arabian states that
recognition of property rights in one’s cells would necessarily entail “a right to
sell one’s own body tissue for profit.” (Page 173.) But this hardly follows, as can be
seen in the first few paragraphs of Justice Mosk’s dissent, discussing property as “a
bundle of rights.” (Page 173.) According to this conception, conventional among
lawyers, property entails a number of disparate rights — the right to possess, the
right to use, the right to exclude, the right to transfer, etc. But in particular cases
you might own property yet not have all of these rights. Consider the right to
transfer. On most occasions you may sell or give away what you own, but not always.
As the examples in footnotes 4-6 show, there are instances where you may sell but
not give, instances where you may give but not sell, and instances where you may
do neither. Notwithstanding, we still talk about what you own as your “property.”7
Could not the majority in Moore have used these observations to craft a more
satisfactory opinion? If the majority had used Justice Mosk’s bundle-of-rights
approach, it could first have held the cells still to be Moore’s property and then
proceeded to the question of alienability. Framing the matter in this way would
readily allow the conclusion that because the cells were Moore’s, they were not
some doctor’s to take, but neither were they Moore’s to sell in a market transaction.
In other words, the majority could have limited Moore’s property rights but nev-
ertheless acknowledged and protected them through the cause of action for con-
version. Concerns about the impact of conversion liability on medical research
and development could in turn have been eased by an appropriately tailored
measure of damages. The literature mentions any number of alternatives, such as
royalties, a percentage of profits, or a lump sum. Suppose the law mandated that
people like Moore were entitled to ten percent of the patent revenues gleaned
from research on their biological material. Would such an approach be satisfy-
ing? Does the law of personal property, which sometimes embraces these sorts of
equitable splits (recall, e.g., Ghen v. Rich and Popov v. Hayashi), help shed light
on the costs and benefits of that approach? Or are the situations too dissimilar for
the comparison to be instructive?
3. Compare Moore to Chakrabarty. Recall our discussion of institutional com-
petence in connection with Diamond v. Chakrabarty. See page 167. In Moore,
the majority also emphasizes the importance of letting legislatures decide con-
troversial questions about what is and isn’t property, as does Justice Arabian’s
concurrence. But their resolution of the case — a refusal to recognize Moore’s
property rights — resembles the dissent in Chakrabarty rather than the majority.
As it happens, there was no legislative override of the decision in Moore, and
rather little sustained legislative attention was paid to the precise public policy

7. When sales are prohibited but gifts allowed, property is sometimes said to be market-inalienable.
When the situation is reversed, one might say property is only market-alienable. When neither mode of transfer
is permitted, the property is said to be inalienable. See Margaret Jane Radin, Market-Inalienability, 100 Harv.
L. Rev. 1849 (1987); Susan Rose Ackerman, Inalienability and the Theory of Property Rights, 85 Colum. L. Rev.
931 (1985).
178

issues that were before the court. The topic received relatively little attention in
other states’ legislatures after Moore as well, perhaps because the decision favored
well-represented interests in biotechnology at the expense of individuals who are
not part of any organized interest group and may not even realize that they have
an economic stake in the issue.
4. The problem of commodification.  The dearth of legislative activity after Moore
should not be understood as indicating that legislatures have been completely silent
with respect to the broader legal issues. The Moore decision hints at this by citing
the Uniform Anatomical Gift Act, adopted in one version or another by every state
in the country. The Uniform Act prohibits sales (that is, transfers for “valuable con-
sideration”) of body parts for purposes of transplantation or therapy (but not for
purposes of research). Federal legislation takes the same tack. The National Organ
Transplantation Act (NOTA), makes it “unlawful for any person to knowingly
acquire, receive, or otherwise transfer any human organ for valuable consideration
for use in human transplantation if the transfer affects interstate commerce.” 42
U.S.C. §274e. Notice that the state and federal statutes implicitly recognize prop-
erty rights in body parts, permitting gifts from living or cadaveric donors and even
permitting sales, unless the sales are for transplantation. (To use the terminology
introduced in footnote 7, the regime is one of partial market-inalienability.)
The ban on sales of organs for transplantation is driven, in part at least, by
a concern with commodification (recall Justice Arabian’s concurring opinion).
Some things, the argument runs, are not mere commodities to be trafficked in
markets, for reasons (in part or entirely) of morality. So we have prohibitions of
slavery, child labor, and prostitution — and sale of body parts for transplantation.
But body parts for transplantation are unfortunately in short supply, and allowing
market incentives could help solve the problem. But if people could sell their kid-
neys (each of us carries a spare), wouldn’t poor people be the sellers and wealthy
people the buyers? If so, would permitting sales result in the exploitation of poor
people? Or would it have the opposite effect, by depriving people of a valuable
right that only poor people are likely to exercise? And so on. The problem of com-
modification, generally and in the particular case of body parts, is deeply difficult
and divisive. See, e.g., Margaret Jane Radin, Contested Commodities (1996); Mark
F. Grady, Politicization of Commodities: The Case of Cadaveric Organs, 20 J. Corp.
L. 51 (1995); Meredith M. Render, The Law of the Body, 62 Emory L.J. 549 (2013).

B. The Public Domain

If I have seen further it is by standing on the shoulders of giants.


Sir Isaac Newton,
Letter to Robert Hooke, Feb. 5, 1765

We saw in Chapter 1 that public ownership of resources can be fraught, poten-


tially resulting in tragedies of the commons that result in the overexploitation
179

and subsequent degradation of a valuable collective resource. Coercion, or some


other powerful form of social control, is often necessary to prevent these trage-
dies from arising. Yet it would be a mistake to take skepticism of public ownership
to the extremes. Systems of real property and intellectual property both embrace
the idea that certain resources are best utilized when owned by the public, or
when the public is given broad access rights. A familiar example of the former is
the national parks system. And we have already been introduced to an example
of the latter — fair use rights that limit copyright. Let us now consider three more
instances in which property law or intellectual property law act to create a vibrant
public domain.

1. The Public Trust Doctrine

Public ownership of waterways deep enough for ships to use (i.e., navigable
waterways) is an arrangement that most nations embrace. International law safe-
guards the freedom of all nations’ ships to use the high seas, prevents any nation
from claiming Antarctica, and puts planetary bodies outside the earth off limits
to future Christopher Columbus types. This case explores the legal basis for limits
on private ownership of beachfront land that arise by virtue of the common law.

Matthews v. Bay Head Improvement Association


Supreme Court of New Jersey, 1984
471 A.2d 355

Schreiber, J. The public trust doctrine acknowledges that the ownership, domin-
ion and sovereignty over land flowed by tidal waters, which extend to the mean
high water mark, is vested in the State in trust for the people. The public’s right
to use the tidal lands and water encompasses navigation, fishing and recre-
ational uses, including bathing, swimming and other shore activities. Borough of
Neptune City v. Borough of Avon-by-the-Sea, 61 N.J. 296, 309, 294 A.2d 47 (1972).
In Avon we held that the public trust applied to the municipally-owned dry sand
beach immediately landward of the high water mark. The major issue in this case
is whether, ancillary to the public’s right to enjoy the tidal lands, the public has a
right to gain access through and to use the dry sand area not owned by a munici-
pality but by a quasi-public body.
The Borough of Point Pleasant instituted this suit against the Borough of
Bay Head and the Bay Head Improvement Association (Association), generally
asserting that the defendants prevented Point Pleasant inhabitants from gaining
access to the Atlantic Ocean and the beachfront in Bay Head. The proceeding
was dismissed as to the Borough of Bay Head because it did not own or control
the beach. Subsequently, . . . Stanley Van Ness, as Public Advocate, joined as plain-
tiff-intervenor. When the Borough of Point Pleasant ceased pursuing the litiga-
tion, the Public Advocate became the primary moving party. The Public Advocate
asserted that the defendants had denied the general public its right of access
180

Bay Head’s sea wall, constructed in 1882


Source: David Gard/Newark Star-Ledger

during the summer bathing season to public trust lands along the beaches in Bay
Head and its right to use private property fronting on the ocean incidental to the
public’s right under the public trust doctrine. The complaint was amended on
several occasions, eliminating the Borough of Point Pleasant as plaintiff and add-
ing more than 100 individuals, who were owners or had interests in properties
located on the oceanfront in Bay Head, as defendants. . . .
The Borough of Bay Head (Bay Head) borders the Atlantic Ocean. Adjacent
to it on the north is the Borough of Point Pleasant Beach, on the south the
Borough of Mantoloking, and on the west Barnegat Bay. Bay Head consists of
a fairly narrow strip of land, 6,667 feet long (about 1 1/4 miles). A beach runs
along its entire length adjacent to the Atlantic Ocean. There are 76 separate par-
cels of land that border the beach. All except six are owned by private individuals.
Title to those six is vested in the Association.
The Association was founded in 1910 and incorporated as a nonprofit cor-
poration in 1932. . . . Its constitution delineates the Association’s object to pro-
mote the best interests of the Borough and “in so doing to own property, operate
bathing beaches, hire life guards, beach cleaners and policemen. . . .”
Nine streets in the Borough, which are perpendicular to the beach, end at
the dry sand. The Association owns the land commencing at the end of seven of
these streets for the width of each street and extending through the upper dry
sand to the mean high water line, the beginning of the wet sand area or fore-
shore. In addition, the Association owns the fee in six shore front properties,
three of which are contiguous and have a frontage aggregating 310 feet. Many
owners of beachfront property executed and delivered to the Association leases
181

of the upper dry sand area. These leases are revocable by either party to the lease
on thirty days’ notice. Some owners have not executed such leases and have not
permitted the Association to use their beaches. . . .
The Association controls and supervises its beach property between the
third week in June and Labor Day. It engages about 40 employees who serve as
lifeguards, beach police and beach cleaners. Lifeguards, stationed at five operat-
ing beaches, indicate by use of flags whether the ocean condition is dangerous
(red), requires caution (yellow), or is satisfactory (green). In addition to observ-
ing and, if need be, assisting those in the water, when called upon lifeguards
render first aid. Beach cleaners are engaged to rake and keep the beach clean
of debris. Beach police are stationed at the entrances to the beaches where the
public streets lead into the beach to ensure that only Association members or
their guests enter. Some beach police patrol the beaches to enforce its member-
ship rules.
Membership is generally limited to residents of Bay Head. Class A members
are property owners. Class B are non-owners. . . . Upon application residents are
routinely accepted. . . .
Except for fishermen, who are permitted to walk through the upper dry
sand area to the foreshore, only the membership may use the beach between
10:00 a.m. and 5:30 p.m. during the summer season. The public is permitted to
use the Association’s beach from 5:30 p.m. to 10:00 a.m. during the summer and,
with no hourly restrictions, between Labor Day and mid-June.
No attempt has ever been made to stop anyone from occupying the terrain
east of the high water mark. During certain parts of the day, when the tide is low,
the foreshore could consist of about 50 feet of sand not being flowed by the water.
The public could gain access to the foreshore by coming from the Borough of
Point Pleasant Beach on the north or from the Borough of Mantoloking on the
south. . . .
In Borough of Neptune City v. Borough of Avon-by-the-Sea, 61 N.J. 296, 303,
294 A.2d 47 (1972), Justice Hall alluded to the ancient principle “that land cov-
ered by tidal waters belonged to the sovereign, but for the common use of all the
people.” The genesis of this principle is found in Roman jurisprudence, which
held that “[b]y the law of nature” “the air, running water, the sea, and conse-
quently the shores of the sea,” were “common to mankind.” Justinian, Institutes
2.1.1 (T. Sandars trans., 1st Am. ed. 1876). No one was forbidden access to the sea,
and everyone could use the seashore “to dry his nets there, and haul them from
the sea. . . .” Id., 2.1.5. The seashore was not private property, but “subject to the
same law as the sea itself, and the sand or ground beneath it.” Id. This underlying
concept was applied in New Jersey in Arnold v. Mundy, 6 N.J.L. 1 (Sup. Ct. 1821).
[I]n Arnold . . . Chief Justice Kirkpatrick, in an extensive opinion, . . . con-
cluded that all navigable rivers in which the tide ebbs and flows and the coasts
of the sea, including the water and land under the water, are “common to all the
citizens, and that each [citizen] has a right to use them according to his neces-
sities, subject only to the laws which regulate that use. . . .” Id. at 93. Regulation
included erecting docks, harbors and wharves, and improving fishery and oyster
beds. This common property . . . [belonged] to the Crown of England, and upon
the Revolution these royal rights became vested in the people of New Jersey. Later
182

in Illinois Central R.R. v. Illinois, 146 U.S. 387, 453 (1892), the Supreme Court, in
referring to the common property, stated that “[t]he State can no more abdicate
its trust over property in which the whole people are interested . . . than it can
abdicate its police powers. . . .”
In Avon, Justice Hall reaffirmed the public’s right to use the waterfront as
announced in Arnold v. Mundy. He observed that the public has a right to use
the land below the mean average high water mark where the tide ebbs and flows.
These uses have historically included navigation and fishing. In Avon the pub-
lic’s rights were extended “to recreational uses, including bathing, swimming and
other shore activities.” 61 N.J. at 309, 294 A.2d 47. . . . Extension of the public
trust doctrine to include bathing, swimming and other shore activities is con-
sonant with and furthers the general welfare. The public’s right to enjoy these
privileges must be respected.
In order to exercise these rights guaranteed by the public trust doctrine, the
public must have access to municipally-owned dry sand areas as well as the fore-
shore. The extension of the public trust doctrine to include municipally-owned
dry sand areas was necessitated by our conclusion that enjoyment of rights in
the foreshore is inseparable from use of dry sand beaches. See Lusardi v. Curtis
Point Property Owners Ass’n, 86 N.J. 217, 228, 430 A.2d 881 (1981). In Avon we
struck down a municipal ordinance that required nonresidents to pay a higher
fee than residents for the use of the beach. We held that where a municipal beach
is dedicated to public use, the public trust doctrine “dictates that the beach and
the ocean waters must be open to all on equal terms and without preference and
that any contrary state or municipal action is impermissible.” 61 N.J. at 309, 294
A.2d 47. The . . . Court depended on the public trust doctrine, impliedly holding
that full enjoyment of the foreshore necessitated some use of the upper sand, so
that the latter came under the umbrella of the public trust.
In Van Ness v. Borough of Deal, 78 N.J. 174, 393 A.2d 571 (1978), we stated
that the public’s right to use municipally-owned beaches was not dependent
upon the municipality’s dedication of its beaches to use by the general public.
The Borough of Deal had dedicated a portion of such beach for use by its resi-
dents only. We found such limited dedication “immaterial” given the public trust
doctrine’s requirement that the public be afforded the right to enjoy all dry sand
beaches owned by a municipality. 78 N.J. at 179-80, 393 A.2d 571.

Public Rights in Privately-Owned Dry Sand Beaches


In Avon and Deal our finding of public rights in dry sand areas was specifi-
cally and appropriately limited to those beaches owned by a municipality. We now
address the extent of the public’s interest in privately-owned dry sand beaches.
This interest may take one of two forms. First, the public may have a right to cross
privately owned dry sand beaches in order to gain access to the foreshore. Second,
this interest may be of the sort enjoyed by the public in municipal beaches under
Avon and Deal, namely, the right to sunbathe and generally enjoy recreational
activities. . . .
Exercise of the public’s right to swim and bathe below the mean high water
mark may depend upon a right to pass across the upland beach. Without some
183

means of access the public right to use the foreshore would be meaningless. To
say that the public trust doctrine entitles the public to swim in the ocean and
to use the foreshore in connection therewith without assuring the public of a
feasible access route would seriously impinge on, if not effectively eliminate, the
rights of the public trust doctrine. This does not mean the public has an unre-
stricted right to cross at will over any and all property bordering on the common
property. The public interest is satisfied so long as there is reasonable access to
the sea. . . .
The bather’s right in the upland sands is not limited to passage. Reasonable
enjoyment of the foreshore and the sea cannot be realized unless some enjoy-
ment of the dry sand area is also allowed.8 The complete pleasure of swimming
must be accompanied by intermittent periods of rest and relaxation beyond the
water’s edge. See State ex rel. Thornton v. Hay, 254 Or. 584, 599-602, 462 P.2d
671, 678-79 (1969) (Denecke, J., concurring). The unavailability of the physical
situs for such rest and relaxation would seriously curtail and in many situations
eliminate the right to the recreational use of the ocean. This was a principal rea-
son why in Avon and Deal we held that municipally-owned dry sand beaches “must
be open to all on equal terms. . . .” Avon, 61 N.J. at 308, 294 A.2d 47. We see no
reason why rights under the public trust doctrine to use of the upland dry sand
area should be limited to municipally-owned property. It is true that the private
owner’s interest in the upland dry sand area is not identical to that of a munici-
pality. Nonetheless, where use of dry sand is essential or reasonably necessary for
enjoyment of the ocean, the doctrine warrants the public’s use of the upland dry
sand area subject to an accommodation of the interests of the owner.
We . . . perceive the public trust doctrine not to be “fixed or static,” but one
to “be molded and extended to meet changing conditions and needs of the pub-
lic it was created to benefit.” Avon, 61 N.J. at 309, 294 A.2d 47.
Precisely what privately-owned upland sand area will be available and
required to satisfy the public’s rights under the public trust doctrine will depend
on the circumstances. Location of the dry sand area in relation to the foreshore,
extent and availability of publicly-owned upland sand area, nature and extent
of the public demand, and usage of the upland sand land by the owner are all
factors to be weighed and considered in fixing the contours of the usage of the
upper sand.
Today, recognizing the increasing demand for our State’s beaches and the
dynamic nature of the public trust doctrine, we find that the public must be given
both access to and use of privately-owned dry sand areas as reasonably necessary.
While the public’s rights in private beaches are not co-extensive with the rights
enjoyed in municipal beaches, private landowners may not in all instances pre-
vent the public from exercising its rights under the public trust doctrine. The
public must be afforded reasonable access to the foreshore as well as a suitable
area for recreation on the dry sand.
. . .

8. Some historical support for this proposition may be found in an analogous situation where fishermen,
in exercising the right of public fishery in tidal waters, were permitted to draw nets on the beach above the ordi-
nary high water mark in the act of fishing. S. Moore & H. Moore, The History and Law of Fisheries 96 (1903).
184

The Bay Head Improvement Association, which services the needs of all
residents of the Borough for swimming and bathing in the public trust property,
owns the street-wide strip of dry sand area at the foot of seven public streets that
extends to the mean high water line. It also owns the fee in six other upland sand
properties connected or adjacent to the tracts it owns at the end of two streets.
In addition, it holds leases to approximately 42 tracts of upland sand area. The
question that we must address is whether the dry sand area that the Association
owns or leases should be open to the public to satisfy the public’s rights under
the public trust doctrine. Our analysis turns upon whether the Association may
restrict its membership to Bay Head residents and thereby preclude public use of
the dry sand area. . . .
The Association’s activities paralleled those of a municipality in its operation
of the beachfront. . . . When viewed in its totality — its purposes, relationship with
the municipality, communal characteristic, activities, and virtual monopoly over
the Bay Head beachfront — the quasi-public nature of the Association is appar-
ent. The Association makes available to the Bay Head public access to the com-
mon tidal property for swimming and bathing and to the upland dry sand area
for use incidental thereto, preserving the residents’ interests in a fashion similar
to Avon. . . .
Accordingly, membership in the Association must be open to the public
at large. In this manner the public will be assured access to the common beach
property during the hours of 10:00 a.m. to 5:30 p.m. between mid-June and
September, where they may exercise their right to swim and bathe and to use the
Association’s dry sand area incidental to those activities. . . .
The Public Advocate has urged that all the privately-owned beachfront
property likewise must be opened to the public. Nothing has been developed
on this record to justify that conclusion. We have decided that the Association’s
membership and thereby its beach must be open to the public. That area might
reasonably satisfy the public need at this time. We are aware that the Association
possessed, as of the initiation of this litigation, about 42 upland sand lots under
leases revocable on 30 days’ notice. If any of these leases have been or are to be
terminated, or if the Association were to sell all or part of its property, it may
necessitate further adjudication of the public’s claims in favor of the public trust
on part or all of these or other privately-owned upland dry sand lands depending
upon the circumstances. . . .
. . . It is not necessary for us to determine under what circumstances and to
what extent there will be a need to use the dry sand of private owners who either
now or in the future may have no leases with the Association. Resolution of the
competing interests, private ownership and the public trust, may in some cases
be simple, but in many it may be most complex. In any event, resolution would
depend upon the specific facts in controversy. . . .
The judgment of the Appellate Division is reversed in part and affirmed in
part. Judgment is entered for the plaintiff against the Association. Judgment of
dismissal against the individual property owners is affirmed without prejudice.
185

NOTES AND QUESTIONS

1. Post-Matthews developments regarding beach access.  After its decision in


Matthews, the New Jersey Supreme Court expanded the public trust doctrine. In
Raleigh Avenue Beach Ass’n v. Atlantis Beach Club, 879 A.2d 112 (N.J. 2005), the
court held that the public’s right to reasonable access to beaches extends to the
dry-sand portion of beaches owned by strictly private entities, as well as by quasi-
public entities such as the Bay Head Improvement Association. In Raleigh Avenue,
the beach owner, Atlantis Beach Club, was strictly private, performing no city-like
functions and having no symbiotic relationship with the municipality. The beach
on the Atlantis property was the only beach in the township, and it was open to
the public free of charge until 1996, when the beach club was established. The
court stated that “Matthews established the framework for application of the pub-
lic trust doctrine to private-owned upland sand beaches.” 879 A.2d at 121. Is this
a satisfactory explanation of the extension of Matthews to Raleigh Avenue? For an
argument that such a right is justified on the basis of promoting human flourish-
ing through improved public health and enhanced sociability, see Gregory S.
Alexander, The Social-Obligation Norm in American Property Law, 94 Cornell L.
Rev. 745, 801-810 (2009).
Contentious fights over beachfront access have raged in other states as well,
most famously in California, where the billionaire co-founder of Sun Microsystems,
Vinod Khosla, paid more than $32 million for oceanfront land that included
Martins Beach, to which the public had long enjoyed access. Khosla locked the
gate leading to Martins beach and painted over billboards that had informed
the public about their ability to access it. He was promptly sued by multiple par-
ties, and his high-powered attorneys have not fared well in the courts so far. See
Surfrider Found. v. Martins Beach 1, LLC, 221 Cal. Rptr. 3d 382 (Cal. App. 2017)
(holding that Khosla’s interruption of public access to Martins Beach constituted
unauthorized development in a coastal zone under California’s Coastal Act of
1976).
2. Origins of the public trust doctrine.  Though its roots lie in Roman law, the
modern version of the public trust doctrine is conventionally traced to the 1892
U.S. Supreme Court decision in Illinois Central Railroad Co. v. Illinois, 146 U.S.
387 (1892). In that case the Illinois legislature in 1886 granted to the railroad in
fee simple (i.e., absolute ownership) submerged lands comprising virtually the
entire Chicago lakefront. Four years later, regretting the grant, the legislature
revoked it. The Supreme Court upheld the revocation, explaining that the leg-
islature did not have the power to convey the entire city lakefront free of trust,
thus barring all future legislatures from protecting the public interest. For a
fuller account of Illinois Central, see Joseph D. Kearney & Thomas W. Merrill, The
Origins of the Public Trust Doctrine: What Really Happened in Illinois Central, 71
U. Chi. L. Rev. 799 (2004). The seminal article that revived interest in the public
trust doctrine is Joseph L. Sax, The Public Trust Doctrine in Natural Resource
Law: Effective Judicial Intervention, 68 Mich. L. Rev. 471 (1970).
3. Scope of the public trust.  The public trust doctrine in Matthews creates an
easement that gives rights to the public generally. An easement provides someone
186

other than the owner(s) of land with rights to use the land or an opportunity to
prevent land from being used in a particular manner. We first encountered ease-
ments in Van Valkenburgh (page 76), and will consider them in much more depth
in Chapter 11.
The public trust doctrine extends to all land covered by the ebb and flow of
the tide and, in addition, all inland lakes and rivers that are navigable. Phillips
Petroleum Co. v. Mississippi, 484 U.S. 469 (1988). In Michigan, the public trust
doctrine protects the public right of access to privately owned beaches along the
Great Lakes. In Glass v. Goeckel, 703 N.W.2d 58 (Mich. 2005), the court held
that public access along the shore is permitted between the current edge of the
lake and the “ordinary high water mark.” Any prior state grants of private prop-
erty rights inconsistent with this public easement, the court said, are invalid. See
Kenneth K. Kilbert, The Public Trust Doctrine and the Great Lakes Shores, 58
Clev. St. L. Rev. 1 (2010).
In recent years, environmentalists have argued that the public trust doctrine
requires their states to restrict greenhouse gas emissions, arguing that the atmo-
sphere is also held in public trust. These suits have met with mixed success so far.
Compare Juliana v. United States, 217 F. Supp. 3d 1224, 1252-56 (D. Or. 2016)
(permitting a public trust suit to proceed on the grounds that climate change
from greenhouse gas emissions is altering the temperature and acidity of the
coastal ocean waters, but reserving the question of whether the atmosphere itself
is subject to the public trust doctrine), with Sanders-Reed v. Martinez, 350 P.3d
1221, 1225-1227 (N.M. App. 2015) (rejecting a common law public trust doctrine
challenge to the state’s permissive rules on greenhouse gas emissions).
The Pennsylvania Supreme Court has interpreted the state constitution’s
public trust clause very broadly to encompass ambient air, flora, fauna, ground-
water, mineral reserves, and wildlife. Robinson Township v. Commonwealth, 83
A.3d 901, 955 (Pa. 2013) (plurality opinion). This broad interpretation is a result
of Pennsylvania’s unusual Environmental Rights Amendment, which was enacted
in 1971, and provides:

The people have a right to clean air, pure water, and to the preservation of the natu-
ral, scenic, historic and esthetic values of the environment. Pennsylvania’s public
natural resources are the common property of all the people, including generations
yet to come. As trustee of these resources, the Commonwealth shall conserve and
maintain them for the benefit of all the people. Penn. Const. Art. I, sec. 27.

Though that language has been on the books for decades, it has only been
in recent years that the courts have interpreted the provision aggressively to limit
legislative action. Pennsylvania Env. Defense Found. v. Commonwealth, 161 A.3d
911 (Pa. 2017), is the relevant landmark case. That case was brought by an envi-
ronmental advocacy organization that objected to the leasing of public park and
forest land for the extraction of natural gas via hydraulic fracturing (i.e., frack-
ing). Those leases were generating more than a hundred million dollars for the
state per year, and Pennsylvania was using those funds to pay for general bud-
getary outlays. Id. at 921. Not so fast, said the Pennsylvania Supreme Court. The
Court held that the Environmental Rights Amendment to the state constitution
187

required the state to prohibit the degradation and depletion of Pennsylvania’s nat-
ural resources, imposing obligations on the state to act affirmatively to do so. The
state needed to act like a trustee, and using money from gas leases to improve the
welfare of Pennsylvania’s residents generally did not satisfy the duty. Id. at 934-936.
Rather, such lease revenue had to be dedicated to serving the narrower interests of
promoting conservation and maintaining natural resources. Id. at 936. How might
this ruling affect the prevalence of fracking in Pennsylvania’s public lands?

2. Copyright’s Public Domain

Matthews examines the public domain in one of property’s dimensions — the phys-


ical dimension. It places limits on the ability of an owner whose land adjoins the
public beaches to exclude outsiders. The public domain in intellectual property
also limits private ownership of ideas. Recall from the discussion of Chakrabarty
that laws of nature, physical phenomena, and abstract ideas cannot be patented.
The case that follows shows that the public domain can also manifest itself across
a temporal dimension as well. Indeed, at least with respect to copyrights and pat-
ents, the law requires that each idea or expression that is presently owned must
eventually belong to everyone, to freely use and enjoy as they see fit. But when?
And why?
As you read through Eldred you should be sensitive to the different nature
of the copyright and patent terms. Copyright law grants creators a very long but
relatively weak monopoly on expressions. Patent holders gain a much shorter
period of exclusive control — patents generally run for twenty years from the date
on which the patent application is filed. But the patent monopoly is much stron-
ger than the copyright one, since it is not limited by concepts such as fair use
(see Authors Guild, supra at 148), and independent invention is not a defense in
a patent infringement suit.

Eldred v. Ashcroft
Supreme Court of the United States, 2003
537 U.S. 186

Justice Ginsburg delivered the opinion of the Court.


This case concerns the authority the Constitution assigns to Congress to
prescribe the duration of copyrights. The Copyright and Patent Clause of the
Constitution, Art. I, §8, cl. 8, provides as to copyrights: “Congress shall have Power
. . . [t]o promote the Progress of Science . . . by securing [to Authors] for lim-
ited Times . . . the exclusive Right to their . . . Writings.” In 1998, in the measure
here under inspection, Congress enlarged the duration of copyrights by 20 years.
Copyright Term Extension Act (CTEA), Pub. L. 105298, §102(b) and (d), 112
Stat. 2827-2828 (amending 17 U.S.C. §§302, 304). As in the case of prior exten-
sions, principally in 1831, 1909, and 1976, Congress provided for application of
the enlarged terms to existing and future copyrights alike.
188

Petitioners are individuals and businesses whose products or services build


on copyrighted works that have gone into the public domain. They seek a determi-
nation that the CTEA fails constitutional review under . . . the Copyright Clause’s
“limited Times” prescription. . . . Under the 1976 Copyright Act, copyright pro-
tection generally lasted from the work’s creation until 50 years after the author’s
death. Pub. L. 94-553, §302(a), 90 Stat. 2572 (1976 Act). Under the CTEA, most
copyrights now run from creation until 70 years after the author’s death. 17
U.S.C. §302(a). Petitioners do not challenge the “life-plus-70-years” time span
itself. “Whether 50 years is enough, or 70 years too much,” they acknowledge, “is
not a judgment meet for this Court.” Brief for Petitioners 14. Congress went awry,
petitioners maintain, not with respect to newly created works, but in enlarging
the term for published works with existing copyrights. The “limited Tim[e]” in
effect when a copyright is secured, petitioners urge, becomes the constitutional
boundary, a clear line beyond the power of Congress to extend. . . .
In accord with the District Court and the Court of Appeals, we reject peti-
tioners’ challenges to the CTEA. In that 1998 legislation, as in all previous copy-
right term extensions, Congress placed existing and future copyrights in parity.
In prescribing that alignment, we hold, Congress acted within its authority and
did not transgress constitutional limitations.
We evaluate petitioners’ challenge to the constitutionality of the CTEA
against the backdrop of Congress’ previous exercises of its authority under the
Copyright Clause. The Nation’s first copyright statute, enacted in 1790, provided
a federal copyright term of 14 years from the date of publication, renewable for
an additional 14 years if the author survived the first term. Act of May 31, 1790,
ch. 15, §1, 1 Stat. 124 (1790 Act). The 1790 Act’s renewable 14-year term applied
to existing works (i.e., works already published and works created but not yet pub-
lished) and future works alike. Congress expanded the federal copyright term
to 42 years in 1831 (28 years from publication, renewable for an additional 14
years), and to 56 years in 1909 (28 years from publication, renewable for an addi-
tional 28 years). Act of Feb. 3, 1831, ch. 16, §§ 1, 16, 4 Stat. 436, 439 (1831 Act);
Act of Mar. 4, 1909, ch. 320, §§ 23-24, 35 Stat. 1080-1081 (1909 Act). Both times,
Congress applied the new copyright term to existing and future works, 1831 Act
§§ 1, 16; 1909 Act §§ 23-24; to qualify for the 1831 extension, an existing work
had to be in its initial copyright term at the time the Act became effective, 1831
Act §§ 1, 16.
In 1976, Congress altered the method for computing federal copyright
terms. 1976 Act §§ 302-304. For works created by identified natural persons, the
1976 Act provided that federal copyright protection would run from the work’s
creation, not — as in the 1790, 1831, and 1909 Acts — its publication; protection
would last until 50 years after the author’s death. §302(a). . . . For anonymous
works, pseudonymous works, and works made for hire, the 1976 Act provided a
term of 75 years from publication or 100 years from creation, whichever expired
first. §302(c).
. . .
The measure at issue here, the CTEA, installed the fourth major duration
extension of federal copyrights. Retaining the general structure of the 1976 Act,
the CTEA enlarges the terms of all existing and future copyrights by 20 years.
189

For works created by identified natural persons, the term now lasts from creation
until 70 years after the author’s death. 17 U.S.C. §302(a).  .  .  . For anonymous
works, pseudonymous works, and works made for hire, the term is 95 years from
publication or 120 years from creation, whichever expires first. 17 U.S.C. §302(c).
Paralleling the 1976 Act, the CTEA applies these new terms to all works
not published by January 1, 1978. §§ 302(a), 303(a). For works published before
1978 with existing copyrights as of the CTEA’s effective date, the CTEA extends
the term to 95 years from publication. §304(a) and (b). Thus, in common with
the 1831, 1909, and 1976 Acts, the CTEA’s new terms apply to both future and
existing copyrights.
Petitioners’ suit challenges the CTEA’s constitutionality under .  .  . the
Copyright Clause.  .  .  . On cross-motions for judgment on the pleadings, the
District Court entered judgment for the Attorney General (respondent here). 74
F. Supp. 2d 1 (D.D.C. 1999). The court held that the CTEA does not violate the
“limited Times” restriction of the Copyright Clause because the CTEA’s terms,
though longer than the 1976 Act’s terms, are still limited, not perpetual, and
therefore fit within Congress’ discretion. . . .
The Court of Appeals for the District of Columbia Circuit affirmed.  .  .  .
We granted certiorari to address . . . whether the CTEA’s extension of existing
copyrights exceeds Congress’ power under the Copyright Clause. . . . We now . . .
affirm.
We address first the determination of the courts below that Congress has
authority under the Copyright Clause to extend the terms of existing copyrights.
Text, history, and precedent, we conclude, confirm that the Copyright Clause
empowers Congress to prescribe “limited Times” for copyright protection and to
secure the same level and duration of protection for all copyright holders, pres-
ent and future.
The CTEA’s baseline term of life plus 70 years, petitioners concede, qualifies
as a “limited Tim[e]” as applied to future copyrights. Petitioners contend, how-
ever, that existing copyrights extended to endure for that same term are not “lim-
ited.” Petitioners’ argument essentially reads into the text of the Copyright Clause
the command that a time prescription, once set, becomes forever “fixed” or “inal-
terable.” The word “limited,” however, does not convey a meaning so constricted.
At the time of the Framing, that word meant what it means today: “confine[d]
within certain bounds,” “restrain[ed],” or “circumscribe[d].” S. Johnson, A
Dictionary of the English Language (7th ed. 1785); see T. Sheridan, A Complete
Dictionary of the English Language (6th ed. 1796) (“confine[d] within certain
bounds”); Webster’s Third New International Dictionary 1312 (1976) (“confined
within limits”; “restricted in extent, number, or duration”). Thus understood, a
time span appropriately “limited” as applied to future copyrights does not auto-
matically cease to be “limited” when applied to existing copyrights. . . .
To comprehend the scope of Congress’ power under the Copyright Clause,
“a page of history is worth a volume of logic.” New York Trust Co. v. Eisner, 256
U.S. 345, 349 (1921) (Holmes, J.). History reveals an unbroken congressional
practice of granting to authors of works with existing copyrights the benefit of
term extensions so that all under copyright protection will be governed even-
handedly under the same regime. As earlier recounted, see supra, at 775, the
190

First Congress accorded the protections of the Nation’s first federal copyright
statute to existing and future works alike. 1790 Act §1. Since then, Congress has
regularly applied duration extensions to both existing and future copyrights.
1831 Act §§ 1, 16; 1909 Act §§ 23-24; 1976 Act §§ 302-303; 17 U.S.C. §§ 302-304.
. . .
Congress’ consistent historical practice of applying newly enacted copyright
terms to future and existing copyrights reflects a judgment stated concisely by
Representative Huntington at the time of the 1831 Act: “[J]ustice, policy, and
equity alike forb[id]” that an “author who had sold his [work] a week ago, be
placed in a worse situation than the author who should sell his work the day after
the passing of [the] act.” 7 Cong. Deb. 424 (1831). . . . The CTEA follows this
historical practice by keeping the duration provisions of the 1976 Act largely in
place and simply adding 20 years to each of them. Guided by text, history, and
precedent, we cannot agree with petitioners’ submission that extending the dura-
tion of existing copyrights is categorically beyond Congress’ authority under the
Copyright Clause.
Satisfied that the CTEA complies with the “limited Times” prescription, we
turn now to whether it is a rational exercise of the legislative authority conferred
by the Copyright Clause. On that point, we defer substantially to Congress. Sony,
464 U.S. at 429 (“[I]t is Congress that has been assigned the task of defining the
scope of the limited monopoly that should be granted to authors . . . in order to
give the public appropriate access to their work product.”).
The CTEA reflects judgments of a kind Congress typically makes, judgments
we cannot dismiss as outside the Legislature’s domain. As respondent describes,
see Brief for Respondent 37-38, a key factor in the CTEA’s passage was a 1993
European Union (EU) directive instructing EU members to establish a copyright
term of life plus 70 years. EU Council Directive 93/98, p. 4; see 144 Cong. Rec.
S12377-S12378 (daily ed. Oct. 12, 1998) (statement of Sen. Hatch). Consistent
with the Berne Convention, the EU directed its members to deny this longer term
to the works of any non-EU country whose laws did not secure the same extended
term. See Berne Conv. Art. 7(8); P. Goldstein, International Copyright §5.3,
p. 239 (2001). By extending the baseline United States copyright term to life plus
70 years, Congress sought to ensure that American authors would receive the
same copyright protection in Europe as their European counterparts. The CTEA
may also provide greater incentive for American and other authors to create and
disseminate their work in the United States. . . .
In addition to international concerns, Congress passed the CTEA in light of
demographic, economic, and technological changes, Brief for Respondent 25-26,
33, and nn. 23 and 24,9 and rationally credited projections that longer terms
would encourage copyright holders to invest in the restoration and public distri-

9. Members of Congress expressed the view that, as a result of increases in human longevity and in
parents’ average age when their children are born, the pre-CTEA term did not adequately secure “the right
to profit from licensing one’s work during one’s lifetime and to take pride and comfort in knowing that one’s
children — and perhaps their children — might also benefit from one’s posthumous popularity.” 141 Cong. Rec.
6553 (1995) (statement of Sen. Feinstein); see 144 Cong. Rec. S12377 (daily ed. Oct. 12, 1998) (statement of
Sen. Hatch) (“Among the main developments [compelling reconsideration of the 1976 Act’s term] is the effect
of demographic trends, such as increasing longevity and the trend toward rearing children later in life, on the
effectiveness of the life-plus-50 term to provide adequate protection for American creators and their heirs.”). . . .
191

bution of their works, Id. at 34-37; see H. R. Rep. No. 105-452, p. 4 (1998) (term
extension “provide[s] copyright owners generally with the incentive to restore
older works and further disseminate them to the public”).10
In sum, we find that the CTEA is a rational enactment; we are not at liberty
to second-guess congressional determinations and policy judgments of this order,
however debatable or arguably unwise they may be. Accordingly, we cannot con-
clude that the CTEA — which continues the unbroken congressional practice of
treating future and existing copyrights in parity for term extension purposes — is
an impermissible exercise of Congress’ power under the Copyright Clause.
Petitioners’ Copyright Clause arguments rely on several novel readings of
the Clause. We next address these arguments and explain why we find them
unpersuasive.
Petitioners contend that even if the CTEA’s 20-year term extension is liter-
ally a “limited Tim[e],” permitting Congress to extend existing copyrights allows
it to evade the “limited Times” constraint by creating effectively perpetual copy-
rights through repeated extensions. We disagree.
As the Court of Appeals observed, a regime of perpetual copyrights “clearly
is not the situation before us.” 239 F.3d at 379. Nothing before this Court warrants
construction of the CTEA’s 20-year term extension as a congressional attempt
to evade or override the “limited Times” constraint. Critically, we again empha-
size, petitioners fail to show how the CTEA crosses a constitutionally significant
threshold with respect to “limited Times” that the 1831, 1909, and 1976 Acts did
not. . . . Those earlier Acts did not create perpetual copyrights, and neither does
the CTEA.
Petitioners dominantly advance a series of arguments all premised on the
proposition that Congress may not extend an existing copyright absent new con-
sideration from the author. . . .
[P]etitioners contend that the CTEA’s extension of existing copyrights does
not “promote the Progress of Science” as contemplated by the preambular lan-
guage of the Copyright Clause. Art. I, §8, cl. 8. To sustain this objection, petition-
ers do not argue that the Clause’s preamble is an independently enforceable
limit on Congress’ power.  .  .  . Rather, they maintain that the preambular lan-
guage identifies the sole end to which Congress may legislate; accordingly, they

10. Justice Breyer urges that the economic incentives accompanying copyright term extension are too
insignificant to “mov[e]” any author with a “rational economic perspective.” Calibrating rational economic
incentives, however, like “fashion[ing] . . . new rules [in light of] new technology,” Sony, 464 U.S. at 431, is a
task primarily for Congress, not the courts. Congress heard testimony from a number of prominent artists;
each expressed the belief that the copyright system’s assurance of fair compensation for themselves and their
heirs was an incentive to create. See, e.g., House Hearings 233-239 (statement of Quincy Jones); Copyright
Term Extension Act of 1995: Hearings before the Senate Committee on the Judiciary, 104th Cong., 1st Sess.,
55-56 (1995) (statement of Bob Dylan); Id. at 56-57 (statement of Don Henley); Id. at 57 (statement of Carlos
Santana). We would not take Congress to task for crediting this evidence which, as Justice Breyer acknowledges,
reflects general “propositions about the value of incentives” that are “undeniably true.”
Congress also heard testimony from Register of Copyrights Marybeth Peters and others regarding the
economic incentives created by the CTEA. According to the Register, extending the copyright for existing works
“could . . . provide additional income that would finance the production and distribution of new works.” House
Hearings 158. “Authors would not be able to continue to create,” the Register explained, “unless they earned
income on their finished works. The public benefits not only from an author’s original work but also from his
or her further creations. Although this truism may be illustrated in many ways, one of the best examples is Noah
Webster[,] who supported his entire family from the earnings on his speller and grammar during the twenty
years he took to complete his dictionary.” Id. at 165.
192

conclude, the meaning of “limited Times” must be “determined in light of that


specified end.” Brief for Petitioners 19. The CTEA’s extension of existing copy-
rights categorically fails to “promote the Progress of Science,” petitioners argue,
because it does not stimulate the creation of new works but merely adds value to
works already created.
As petitioners point out, we have described the Copyright Clause as “both
a grant of power and a limitation,” Graham v. John Deere Co. of Kansas City,
383 U.S. 1, 5 (1966), and have said that “[t]he primary objective of copyright” is
“[t]o promote the Progress of Science,” Feist, 499 U.S. at 349. The “constitutional
command,” we have recognized, is that Congress, to the extent it enacts copyright
laws at all, create a “system” that “promote[s] the Progress of Science.” Graham,
383 U.S. at 6.
We have also stressed, however, that it is generally for Congress, not the
courts, to decide how best to pursue the Copyright Clause’s objectives. . . . The
justifications we earlier set out for Congress’ enactment of the CTEA, provide
a rational basis for the conclusion that the CTEA “promote[s] the Progress of
Science.”
On the issue of copyright duration, Congress, from the start, has routinely
applied new definitions or adjustments of the copyright term to both future
works and existing works not yet in the public domain. Such consistent congres-
sional practice is entitled to “very great weight, and when it is remembered that
the rights thus established have not been disputed during a period of [over two]
centur[ies], it is almost conclusive.” Burrow-Giles Lithographic Co. v. Sarony, 111
U.S. at 57. . . . Congress’ unbroken practice since the founding generation thus
overwhelms petitioners’ argument that the CTEA’s extension of existing copy-
rights fails per se to “promote the Progress of Science.”
Closely related to petitioners’ preambular argument, or a variant of it, is their
assertion that the Copyright Clause “imbeds a quid pro quo.” Brief for Petitioners
23. They contend, in this regard, that Congress may grant to an “Autho[r]” an
“exclusive Right” for a “limited Tim[e],” but only in exchange for a “Writin[g].”
Congress’ power to confer copyright protection, petitioners argue, is thus con-
tingent upon an exchange: The author of an original work receives an “exclusive
Right” for a “limited Tim[e]” in exchange for a dedication to the public there-
after. Extending an existing copyright without demanding additional consider-
ation, petitioners maintain, bestows an unpaid-for benefit on copyright holders
and their heirs, in violation of the quid pro quo requirement.
We can demur to petitioners’ description of the Copyright Clause as a grant
of legislative authority empowering Congress “to secure a bargain — this for that.”
. . . But the legislative evolution earlier recalled demonstrates what the bargain
entails. Given the consistent placement of existing copyright holders in parity with
future holders, the author of a work created in the last 170 years would reasonably
comprehend, as the “this” offered her, a copyright not only for the time in place
when protection is gained, but also for any renewal or extension legislated during
that time. Congress could rationally seek to “promote . . . Progress” by including
in every copyright statute an express guarantee that authors would receive the
benefit of any later legislative extension of the copyright term. Nothing in the
193

Copyright Clause bars Congress from creating the same incentive by adopting the
same position as a matter of unbroken practice.
. . .
If petitioners’ vision of the Copyright Clause held sway, it would do more
than render the CTEA’s duration extensions unconstitutional as to existing works.
Indeed, petitioners’ assertion that the provisions of the CTEA are not severable
would make the CTEA’s enlarged terms invalid even as to tomorrow’s work. The
1976 Act’s time extensions, which set the pattern that the CTEA followed, would
be vulnerable as well.
As we read the Framers’ instruction, the Copyright Clause empowers
Congress to determine the intellectual property regimes that, overall, in that
body’s judgment, will serve the ends of the Clause. . . . Beneath the facade of their
inventive constitutional interpretation, petitioners forcefully urge that Congress
pursued very bad policy in prescribing the CTEA’s long terms. The wisdom of
Congress’ action, however, is not within our province to second guess. Satisfied
that the legislation before us remains inside the domain the Constitution assigns
to the First Branch, we affirm the judgment of the Court of Appeals.
It is so ordered.

Breyer, J., dissenting. The Constitution’s Copyright Clause grants Congress the
power to “promote the Progress of Science .  .  . by securing for limited Times
to Authors . . . the exclusive Right to their respective Writings.” Art. I, §8, cl. 8
(emphasis added). The statute before us, the 1998 Sonny Bono Copyright Term
Extension Act, extends the term of most existing copyrights to 95 years and that
of many new copyrights to 70 years after the author’s death. The economic effect
of this 20-year extension — the longest blanket extension since the Nation’s
founding — is to make the copyright term not limited, but virtually perpetual.
Its primary legal effect is to grant the extended term not to authors, but to their
heirs, estates, or corporate successors. And most importantly, its practical effect
is not to promote, but to inhibit, the progress of “Science” — by which word the
Framers meant learning or knowledge,
The majority believes these conclusions rest upon practical judgments that
at most suggest the statute is unwise, not that it is unconstitutional. Legal dis-
tinctions, however, are often matters of degree.  .  .  . And in this case the fail-
ings of degree are so serious that they amount to failings of constitutional kind.
Although the Copyright Clause grants broad legislative power to Congress, that
grant has limits. And in my view this statute falls outside them.
The “monopoly privileges” that the Copyright Clause confers “are neither
unlimited nor primarily designed to provide a special private benefit.” Sony Corp.
of America v. Universal City Studios, Inc., 464 U.S. 417, 429 (1984). . . . This Court
has made clear that the Clause’s limitations are judicially enforceable. And, in
assessing this statute for that purpose, I would take into account the fact that the
Constitution is a single document, that it contains both a Copyright Clause and a
First Amendment, and that the two are related.
The Copyright Clause and the First Amendment seek related objec-
tives — the creation and dissemination of information. When working in tandem,
these provisions mutually reinforce each other, the first serving as an “engine of
194

free expression,” Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S.
539, 558 (1985), the second assuring that government throws up no obstacle
to its dissemination. At the same time, a particular statute that exceeds proper
Copyright Clause bounds may set Clause and Amendment at cross-purposes,
thereby depriving the public of the speech-related benefits that the Founders,
through both, have promised.
. . . I would find that the statute lacks the constitutionally necessary rational
support (1) if the significant benefits that it bestows are private, not public; (2)
if it threatens seriously to undermine the expressive values that the Copyright
Clause embodies; and (3) if it cannot find justification in any significant Clause-
related objective. Where, after examination of the statute, it becomes difficult,
if not impossible, even to dispute these characterizations, Congress’ “choice is
clearly wrong.” Helvering v. Davis, 301 U.S. 619, 640 (1937).
Because we must examine the relevant statutory effects in light of the
Copyright Clause’s own purposes, we should begin by reviewing the basic objec-
tives of that Clause. The Clause authorizes a “tax on readers for the purpose of giv-
ing a bounty to writers.” 56 Parl. Deb. (3d Ser.) (1841) 341, 350 (Lord Macaulay).
Why? What constitutional purposes does the “bounty” serve?
The Constitution itself describes the basic Clause objective as one of
“promot[ing] the Progress of Science,” i.e., knowledge and learning. The Clause
exists not to “provide a special private benefit,” Sony, supra, at 429, but “to stim-
ulate artistic creativity for the general public good,” Twentieth Century Music
Corp. v. Aiken, 422 U.S. 151, 156 (1975). It does so by “motivat[ing] the creative
activity of authors” through “the provision of a special reward.” Sony, supra, at
429. The “reward” is a means, not an end. And that is why the copyright term is
limited. It is limited so that its beneficiaries — the public — “will not be perma-
nently deprived of the fruits of an artist’s labors.” Stewart v. Abend, 495 U.S. 207,
228 (1990).
. . .
This statute, like virtually every copyright statute, imposes upon the public
certain expression-related costs in the form of (1) royalties that may be higher
than necessary to evoke creation of the relevant work, and (2) a requirement
that one seeking to reproduce a copyrighted work must obtain the copyright
holder’s permission. The first of these costs translates into higher prices that will
potentially restrict a work’s dissemination. The second means search costs that
themselves may prevent reproduction even where the author has no objection.
Although these costs are, in a sense, inevitable concomitants of copyright protec-
tion, there are special reasons for thinking them especially serious here.
First, the present statute primarily benefits the holders of existing copyrights,
i.e., copyrights on works already created. And a Congressional Research Service
(CRS) study prepared for Congress indicates that the added royalty-related sum
that the law will transfer to existing copyright holders is large. E. Rappaport,
CRS Report for Congress, Copyright Term Extension: Estimating the Economic
Values (1998) (hereinafter CRS Report). In conjunction with official figures on
copyright renewals, the CRS Report indicates that only about 2% of copyrights
between 55 and 75 years old retain commercial value — i.e., still generate royalties
195

after that time. But books, songs, and movies of that vintage still earn about $400
million per year in royalties. CRS Report 8, 12, 15. Hence, (despite declining
consumer interest in any given work over time) one might conservatively estimate
that 20 extra years of copyright protection will mean the transfer of several billion
extra royalty dollars to holders of existing copyrights — copyrights that, together,
already will have earned many billions of dollars in royalty “reward.” See id. at 16.
The extra royalty payments will not come from thin air. Rather, they ulti-
mately come from those who wish to read or see or hear those classic books or
films or recordings that have survived. Even the $500,000 that United Airlines
has had to pay for the right to play George Gershwin’s 1924 classic Rhapsody in
Blue represents a cost of doing business, potentially reflected in the ticket prices
of those who fly. . . .
A second, equally important, cause for concern arises out of the fact that
copyright extension imposes a “permissions” requirement — not only upon
potential users of “classic” works that still retain commercial value, but also upon
potential users of any other work still in copyright. Again using CRS estimates,
one can estimate that, by 2018, the number of such works 75 years of age or older
will be about 350,000. See Brief for Petitioners 7. Because the Copyright Act of
1976 abolished the requirement that an owner must renew a copyright, such still-
in-copyright works (of little or no commercial value) will eventually number in
the millions. . . .
The potential users of such works include not only movie buffs and aging
jazz fans, but also historians, scholars, teachers, writers, artists, database opera-
tors, and researchers of all kinds — those who want to make the past accessible
for their own use or for that of others. The permissions requirement can inhibit
their ability to accomplish that task. Indeed, in an age where computer-accessible
databases promise to facilitate research and learning, the permissions require-
ment can stand as a significant obstacle to realization of that technological hope.
The reason is that the permissions requirement can inhibit or prevent the
use of old works (particularly those without commercial value): (1) because it may
prove expensive to track down or to contract with the copyright holder, (2) because
the holder may prove impossible to find, or (3) because the holder when found
may deny permission either outright or through misinformed efforts to bargain.
. . . The older the work, the less likely it retains commercial value, and the
harder it will likely prove to find the current copyright holder. The older the
work, the more likely it will prove useful to the historian, artist, or teacher. The
older the work, the less likely it is that a sense of authors’ rights can justify a
copyright holder’s decision not to permit reproduction, for the more likely it is
that the copyright holder making the decision is not the work’s creator, but, say,
a corporation or a great-grandchild whom the work’s creator never knew.  .  .  .
And the qualitative costs to education, learning, and research will multiply as
our children become ever more dependent for the content of their knowledge
upon computer-accessible databases — thereby condemning that which is not so
accessible, say, the cultural content of early 20th-century history, to a kind of intel-
lectual purgatory from which it will not easily emerge.
. . .
196

What copyright-related benefits might justify the statute’s extension of


copyright protection? First, no one could reasonably conclude that copyright’s
traditional economic rationale applies here. The extension will not act as an eco-
nomic spur encouraging authors to create new works. . . . No potential author
can reasonably believe that he has more than a tiny chance of writing a classic
that will survive commercially long enough for the copyright extension to mat-
ter. After all, if, after 55 to 75 years, only 2% of all copyrights retain commercial
value, the percentage surviving after 75 years or more (a typical pre-extension
copyright term) — must be far smaller.  .  .  . Using assumptions about the time
value of money provided us by a group of economists (including five Nobel prize
winners), Brief for George A. Akerlof et al. as Amici Curiae 5-7, it seems fair to say
that, for example, a 1% likelihood of earning $100 annually for 20 years, starting
75 years into the future, is worth less than seven cents today.
What potential Shakespeare, Wharton, or Hemingway would be moved by
such a sum? What monetarily motivated Melville would not realize that he could
do better for his grandchildren by putting a few dollars into an interest-bearing
bank account? The Court itself finds no evidence to the contrary. . . .
Regardless, even if . . . somehow, somewhere, some potential author might be
moved by the thought of great-grandchildren receiving copyright royalties a cen-
tury hence, so might some potential author also be moved by the thought of royal-
ties being paid for two centuries, five centuries, 1,000 years, “ ‘til the End of Time.”
And from a rational economic perspective the time difference among these peri-
ods makes no real difference. The present extension will produce a copyright
period of protection that, even under conservative assumptions, is worth more
than 99.8% of protection in perpetuity (more than 99.99% for a songwriter like
Irving Berlin and a song like Alexander’s Ragtime Band). . . . The lack of a practi-
cally meaningful distinction from an author’s ex ante perspective between (a) the
statute’s extended terms and (b) an infinite term makes this latest extension dif-
ficult to square with the Constitution’s insistence on “limited Times.” . . .
. . .
In any event, the incentive-related numbers are far too small for Congress
to have concluded rationally, even with respect to new works, that the extension’s
economic-incentive effect could justify the serious expression-related harms ear-
lier described. And, of course, in respect to works already created — the source
of many of the harms previously described — the statute creates no economic
incentive at all.
. . .
Finally, the Court mentions as possible justifications “demographic, eco-
nomic, and technological changes” — by which the Court apparently means the
facts that today people communicate with the help of modern technology, live
longer, and have children at a later age. The first fact seems to argue not for, but
instead against, extension. The second fact seems already corrected for by the
1976 Act’s life-plus-50 term, which automatically grows with lifespans.  .  .  . And
the third fact — that adults are having children later in life — is a makeweight
at best, providing no explanation of why the 1976 Act’s term of 50 years after
an author’s death — a longer term than was available to authors themselves for
most of our Nation’s history — is an insufficient potential bequest. The weakness
197

“I Got You Babe”


Sonny and Cher

of these final rationales simply underscores the conclusion that emerges from
consideration of earlier attempts at justification: There is no legitimate, serious
copyright-related justification for this statute.
. . .
This statute will cause serious expression-related harm. It will likely restrict
traditional dissemination of copyrighted works. It will likely inhibit new forms of
dissemination through the use of new technology. It threatens to interfere with
efforts to preserve our Nation’s historical and cultural heritage and efforts to
use that heritage, say, to educate our Nation’s children. It is easy to understand
how the statute might benefit the private financial interests of corporations or
heirs who own existing copyrights. But I cannot find any constitutionally legiti-
mate, copyright-related way in which the statute will benefit the public. Indeed,
in respect to existing works, the serious public harm and the virtually nonexistent
public benefit could not be more clear.
I have set forth the analysis upon which I rest these judgments. This analysis
leads inexorably to the conclusion that the statute cannot be understood ratio-
nally to advance a constitutionally legitimate interest. The statute falls outside
the scope of legislative power that the Copyright Clause, read in light of the First
Amendment, grants to Congress. I would hold the statute unconstitutional.
I respectfully dissent.
[A separate dissent by Justice Stevens is omitted.]
198

NOTES AND QUESTIONS

1. The rest of the story.  The statute that was challenged in the case, the
Copyright Term Extension Act, was popularly known as the “Sonny Bono Act.”
Congressman Bono had been a co-sponsor of the original bill in the House of
Representative prior to his untimely death in 1998 by skiing into a tree in Nevada.
His widow, Mary Bono, who succeeded him in the House, carried on his support
for the bill through its passage. The Act was also sometimes derisively called the
“Mickey Mouse Act” because the Disney Company was a major force behind its
passage. If Congress does not enact legislation lengthening the copyright term
yet again, copyrighted works are set to start entering the public domain at the
beginning of 2019.
2. Subsequent legal developments.  In Golan v. Holder, 565 U.S. 302 (2012), by
a 6-to-2 vote, the Supreme Court extended Eldred, holding that the Constitution
didn’t prevent Congress from permitting foreign works that had fallen into the
public domain to become copyrighted once again, in accordance with the Berne
Convention for the Protection of Literary and Artistic Works.
3. Purpose of the CTEA.  Does it matter why Congress enacted the CTEA?
Suppose Congress’s motivation was to enrich the owners of copyrights of preex-
isting works about to fall into the public domain. Given the language of Article I,
section 8 of the Constitution (“promote the Progress of Science and the Useful
Arts. . . .”), would this be a legitimate reason? Does that matter?
4. Outer temporal limits?  After Eldred, are there any outer limits to how long
Congress may extend the duration of copyrights, short of a literally infinite copy-
right term? Suppose Congress decided to extend the copyright term to 1,000
years; would that be unconstitutional?

3. Trademark Law’s Public Domain

In this chapter, we have already considered patent law (governing the ownership of
inventions), and copyright law (governing the ownership of creative expression).
Trademark law forms a third key branch of intellectual property law, and it gov-
erns brands, logos, slogans, and other signifiers used in trade. Volkswagen’s VW,
MGM’s lion, Nike’s swoosh, Pepsi-Cola’s script-written name — all are examples
of trademarks. Trademarks have been around almost as long as trade itself. Marks
such as a potter’s mark have been found on artifacts from ancient civilizations in
China, India, Greece, Egypt, and elsewhere, dating back as far as 4,000 years ago.
Modern trademark law defines a trademark as any “word, name, symbol,
or device” used by a person “to identify and distinguish his or her goods” from
those sold by others, and “to indicate the source of the goods.” 15 U.S.C. §1127.
The reasons for protecting trademarks differ from the policies behind patent
and copyright. As we have seen, patents and copyrights are intended to encour-
age creativity, invention, and expression. Trademark law, by contrast, protects
whoever is first to use a distinctive mark in commerce (the first-in-time prin-
ciple, again). As the Supreme Court has said, trademark protection “does not
depend upon . . . invention, discovery, or any work of the brain.” Trade-Mark
199

Cases, 100 U.S. 82, 94 (1879). Three main policies underlie trademark law.
First, exclusive rights to trademarks prevent consumer confusion about the ori-
gin of the goods or service. Second, they encourage trademark owners to invest
in and maintain a consistent level of quality. Finally, they prevent competitors
from freeriding on the trademark owner’s goodwill. Trademark is therefore a
body of law that deals with situations in which information becomes a source-
identifier, rendering the use of that identifying information rivalrous. If you
start bottling a soft drink and selling it as Coca Cola, without the company’s
permission, that will damage Coca Cola’s economic interests and likely harm
consumers too.
Originally, trademark protection was a matter of the state common law of
unfair competition. This common law foundation is now supplemented by the
federal Lanham Act, which has been amended several times and was enacted
pursuant to Congress’s authority to regulate interstate commerce under the
Constitution’s Commerce Clause. The Lanham Act allows a trademark owner to
register the mark with the Patent and Trademark Office, but registration is not
required for the mark’s validity.
Generally speaking, words, symbols, jingles, and other sounds can be trade-
marked. The Supreme Court has even held that colors can be trademarked under
specific circumstances. See Qualitex v. Jacobson Products Co., Inc., 514 U.S. 159
(1995). As a rule, three requirements must be met for trademark protection: (1)
distinctiveness; (2) non-functionality; and (3) first use in trade.
Distinctiveness. This means that the mark must distinguish the good or ser-
vice of one person from those of another. The Lanham Act categorizes marks
according to varying degrees of distinctiveness. It is easiest to demonstrate dis-
tinctiveness for fanciful marks that coin a new word for a brand (like Exxon gaso-
line) or arbitrary marks that use an existing word that has nothing to do with
the product (like Apple computers). Fanciful and arbitrary marks typically get
the strongest protection. Suggestive marks are also considered inherently distinc-
tive. They evoke the nature of the good subtly but still require the consumer to
use “imagination and perception” to determine the nature of the product being
sold. Examples include Microsoft or Tide detergent. Descriptive marks describe a
purpose or characteristic of the product. Think of Almond Joy candy bars or Bed
Bath & Beyond stores. Descriptive marks can still be protected if the product has
acquired “secondary meaning” in the relevant marketplace. For example, Coca-
Cola started off as a description of the kind of beverage being sold, but has come
to be synonymous with a particular drink sold by a particular company. So, too,
with Sharp television sets.
Non-functionality. Trademark law does not protect on the basis of functional-
ity. That is what patent law does. Hence, if an aspect of a good is exclusively func-
tional, it cannot be protected by trademark law. A product feature is functional “if
it is essential to the use or purpose of the article or if it affects the cost or quality
of the article, that is, if exclusive use of the feature would put competitors at a
significant non-reputation-related disadvantage.” Qualitex, 514 U.S. at 165. For
example, a car maker could not trademark a particularly aerodynamic shape for
its side view mirrors, even if the shape came to be associated with the brand. This
doctrine helps police the boundary between trademark and patent.
200

First use in trade. An exclusive right to use a mark requires first use, not just
first adoption, of the mark in a particular geographic market. Moreover, under
the Lanham Act, the use must be in commerce, which has a narrower scope than
trade.
Just as the public trust doctrine prevents some types of real property from
being fully privatized, and patent and copyright law requires that at some point
in the future patents and copyrights fall into the public domain, there are fur-
ther limits on what words can be trademarked. A generic term is synonymous with
a product itself, rather than with a particular maker of that product. In order to
promote competition in the marketplace, the Lanham Act treats generic terms as
part of the public domain. Policing the boundaries of generic versus non-generic
marks is an important task for the Patent and Trademark Office and, ultimately,
the courts.

In re Cordua Restaurants, Inc.


United States Court of Appeals for the Federal Circuit, 2016
823 F.3d 594

Dyk, J. Cordua Restaurants, Inc. (“Cordua”) appeals from the final decision of the
United States Patent and Trademark Office Trademark Trial and Appeal Board
(“Board”) refusing registration of a stylized form of the mark CHURRASCOS.11
The Board’s decision contains no harmful legal error, and the Board’s finding
that the mark is generic is supported by substantial evidence. We affirm.
Appellant Cordua owns and operates a chain of five restaurants branded
as “Churrascos,” the first of which opened in 1988. The Churrascos restaurants
serve a variety of South American dishes, including grilled meats; the Churrascos
menu describes chargrilled “Churrasco Steak” as “our signature.” . . .
On January 10, 2011, Cordua filed U.S. Trademark Application Serial No.
85/214,191 (“the ’191 Application”), the application at issue in this case, seek-
ing protection of the stylized form of CHURRASCOS for use in connection
with “Bar and restaurant services; Catering. The trademark examiner rejected
the ’191 Application as merely descriptive and on the basis that “the applied-for
mark is generic for applicant’s services,” barring registration under Lanham Act
§ 2(e)(1) (15 U.S.C. §  1052(e)(1)). On June 14, 2012, the examiner issued a

11. The stylized mark is:

Hereinafter we refer to this mark as “the stylized form of CHURRASCOS.” [In 2007, the trademark
examiner had granted Cordua a mark in the word “Churrascos” itself, written in standard characters, but when
Cordua sought a new mark on the stylized form of the word, the appellate board held that it was not bound by
the examiner’s determination with respect to the prior registration. In the board’s view, the earlier determi-
nation did not control the present dispute because “[t]rademark rights are not static,” but rather have to be
responsive to the circumstances “at the time registration is sought.” 110 U.S.P.Q.2d 1227 (Trademark Trial &
Appeal Bd. March 24, 2014). — Eds.]
201

final rejection, again refusing registration of the stylized form of CHURRASCOS


on the basis of descriptiveness and genericness. With respect to genericness, the
examiner concluded that the term “churrascos” “refer[s] to beef or grilled meat
more generally” and that the term “identifies a key characteristic or feature of the
restaurant services, namely, the type of restaurant.”
Cordua appealed to the Board, which affirmed the examiner’s refusal to reg-
ister the mark for use in connection with restaurant services. The Board agreed
with the examiner that “‘churrascos’ is the generic term for a type of cooked
meat” and “a generic term for a restaurant featuring churrasco steaks.” Cordua,
2014 WL 1390504, at *6. . . . The Board also agreed with the examiner that the
stylized form of CHURRASCOS was also ineligible for registration because it is
merely descriptive of a restaurant serving barbecued steaks. . . . Cordua appealed.
We consider whether the Board erred in refusing registration on the ground
that the mark is generic. . . . The question of whether a particular mark is generic
under the applicable standard is a question of fact, which we review for substan-
tial evidence.
As the Supreme Court has held, “[g]eneric terms are not registrable, and a
registered mark may be canceled at any time on the grounds that it has become
generic.” Park ’N Fly, Inc. v. Dollar Park and Fly, Inc., 469 U.S. 189, 194 (1985)
(citing 15 U.S.C. §§ 1052, 1064). This is so because “[g]eneric terms, by defini-
tion incapable of indicating source, are the antithesis of trademarks, and can
never attain trademark status.” In re Merrill Lynch, Pierce, Fenner, & Smith, Inc.,
828 F.2d 1567, 1569 (Fed. Cir. 1987). . . .
“A generic term ‘is the common descriptive name of a class of goods or ser-
vices.’” Princeton Vanguard v. Frito-Lay North America, 786 F.3d at 965 (quoting
H. Marvin Ginn Corp. v. Int’l Ass’n of Fire Chiefs, Inc., 782 F.2d 987, 989 (Fed.
Cir. 1986)). “The critical issue in genericness cases is whether members of the rel-
evant public primarily use or understand the term sought to be protected to refer
to the genus of goods or services in question.” Ginn, 782 F.2d at 989-990. Under
Ginn a two-step test is applied to determine whether a given term is generic. Id.
at 990. “First, what is the genus of goods or services at issue? Second, is the term
sought to be registered or retained on the register understood by the relevant
public primarily to refer to that genus of goods or services?” Id. . . . “Evidence of
the public’s understanding of the mark may be obtained from ‘any competent
source, such as consumer surveys, dictionaries, newspapers and other publica-
tions.’” Princeton Vanguard, 786 F.3d at 965 (quoting In re Northland Aluminum
Prods., Inc., 777 F.2d 1556, 1559 (Fed. Cir. 1985)).
We next address whether the term “churrascos” is generic for restaurant ser-
vices generally, as identified in the ’191 Application. The Board found, “[b]ased
on the evidence that ‘churrascos’ is the generic term for a type of cooked meat,”
that “‘churrascos’ is a generic term for a restaurant featuring churrasco steaks.”
Cordua, 2014 WL 1390504, at *6. The Board’s decision in this respect is supported
by substantial evidence.
Cordua concedes that the term “churrasco” is a word in Spanish and
Portuguese referring to barbecue, and the ’191 Application itself acknowledges
that “[t]he English translation of churrascos in the mark is barbecue.” “Under
the doctrine of foreign equivalents, foreign words from common languages
202

are translated into English to determine genericness, descriptiveness, as well as


similarity of connotation. . . .” Palm Bay Imps., Inc. v. Veuve Clicquot Ponsardin
Maison Fondee En 1772, 396 F.3d 1369, 1377 (Fed. Cir. 2005).  .  .  . Because
“churrasco” is a common word in Spanish and Portuguese and because the
’191 Application itself concedes that “churrascos” means “barbecue,” the PTO
would have been justified in translating “churrascos” into “barbecue” and sub-
sequently determining whether the term “barbecue” is generic when applied
to restaurant services. Indeed, the examiner aptly remarked that “a foreign
equivalent of a generic English word is no more registrable than the English
word itself.”
But the examiner, and the Board, did not rely here on the doctrine of for-
eign equivalents. Instead, the examiner and the Board found that “churrasco”
is used in the English language to refer to grilled meat. The evidence before
the Board included, inter alia, three English-language dictionaries that define
“churrasco” as grilled meat. Two of the dictionaries specify that the meat is steak
or beef. Id. The dictionaries constitute evidence that “churrasco” is a generic
English-language term for grilled meat, especially grilled steak. Cordua essen-
tially concedes this point. . . .
However, Cordua contends that the addition of the “S” at the end of
CHURRASCOS makes the term non-generic. That is, while Cordua concedes
that “churrasco” describes a grilled steak, it argues that adding an “S” changes
the term’s meaning because “churrascos” is not the proper pluralization of
“churrasco” in Spanish. While each trademark must always be evaluated indi-
vidually, pluralization commonly does not alter the meaning of a mark. See In
re Belgrade Shoe Co., 56 C.C.P.A. 1298, 411 F.2d 1352, 1353 (1969); Wilson v.
Delaunay, 44 C.C.P.A. 1019, 245 F.2d 877, 878 (1957). Since “churrascos” is an
English-language term, there is nothing in the record to indicate that the addi-
tion of the “S” at the end alters its meaning (beyond making the word plural).
In fact, the Board found that at least one English-language dictionary presents
“churrascos” as the plural form of “churrasco,” meaning meat cooked over an
open fire. The Board also credited an article that appeared in an online (English-
language) version of Esquire Magazine that used the precise term “churrascos”
to refer to “juicy, charred slabs” of tenderloin steak. 2014 WL 1390504, at *4.
There is, therefore, substantial evidence to support the Board’s conclusion that
“‘churrascos’ is the generic term for a type of cooked meat.” Id.
Cordua next argues that “churrascos” (or “churrasco”) refers specifically to
a style of grilling meat and not to restaurant services. But a term can be generic
for a genus of goods or services if the relevant public — here, the restaurant-going
public — understands the term to refer to a key aspect of that genus — e.g., a key
good that characterizes a particular genus of retail services. “A generic name of
goods may also be a generic name of the service of selling or designing those
goods.” 2 McCarthy § 12:23. We have held that “[t]he test is not only whether the
relevant public would itself use the term to describe the genus, but also whether
the relevant public would understand the term to be generic.” In re 1800Mattress.
com IP, LLC, 586 F.3d 1359, 1364 (Fed. Cir. 2009). “[A]ny term that the relevant
public understands to refer to the genus . . . is generic.” Id.
203

In 1800Mattress.com, we affirmed the Board’s determination that


MATTRESS.COM is generic for “online retail store services in the field of mat-
tresses, beds, and bedding” because the term “mattress” identified a key aspect
of such services. Id. at 1361, 1364. In Hotels.com, we affirmed the Board’s deter-
mination that HOTELS.COM is generic for “providing information for others
about temporary lodging” and “travel agency services” because the term “hotels”
“names a key aspect” of such services. 573 F.3d at 1301, 1304, 1306. And in Reed
Elsevier, we affirmed the Board’s determination that LAWYERS.COM is generic
for “information exchange concerning the law, legal news, and legal services,”
because “an integral, if not the paramount, aspect of information exchange
about legal services as Reed defines it concerns identifying and helping people
to select lawyers.” 482 F.3d at 1379, 1380 (alterations and internal quotation
marks omitted). . . .
Thus, Cordua is wrong that “a dish, even a specialty dish, does not identify
the genus of restaurant services.” Appellant’s Br. at 33. If the relevant public would
understand a term denoting a specialty dish to refer to a key aspect of restaurant
services, then the term is generic for restaurant services. See Hunt Masters, Inc.
v. Landry’s Seafood Rest., Inc., 240 F.3d 251, 254 (4th Cir. 2001) (holding that
“crab house” is a generic term referring to a class of restaurants that serve crabs).
There is substantial evidence in the record that “churrascos” refers to a key
aspect of a class of restaurants because those restaurants are commonly referred
to as “churrasco restaurants.” For example, the TTAB’s decision points to one
newspaper article praising a “Brazilian churrasco restaurant” notable for its “siz-
zling food” served “on spits straight from the fire”; a second article that describes
a “churrasco restaurant” as a restaurant distinguished by serving “[m]eat of all
kinds”; and a third article that characterizes a “churrasco restaurant” as a kind of
restaurant that serves “South American mixed grill.” Each of these articles consti-
tutes evidence that the restaurant-going public understands the term “churrascos”
to refer to a type of restaurant as well as a dish. Each article therefore supports the
Board’s conclusion that “there is a class of restaurants that have churrascos as a
central focus of their services, and that both competitors in the field and consum-
ers use the term ‘Churrasco’ to refer to this type of restaurant.” We perceive no
error in this part of the Board’s analysis.
Cordua argues that even if “churrascos” is generic as to “churrasco restau-
rants” (also known as “churrascarias”), it is not generic as to all restaurant ser-
vices. But a term is generic if the relevant public understands the term to refer to
part of the claimed genus of goods or services, even if the public does not under-
stand the term to refer to the broad genus as a whole. Thus, the term “pizzeria”
would be generic for restaurant services, even though the public understands the
term to refer to a particular sub-group or type of restaurant rather than to all res-
taurants. See, e.g., Northland Aluminum, 777 F.2d at 1561 (affirming the TTAB’s
determination that BUNDT is generic “for a type of ring cake”). . . . “A registra-
tion is properly refused if the word is the generic name of any of the goods or ser-
vices for which registration is sought.” 2 McCarthy § 12:57. A “term need not refer
to an entire broad species, like ‘cheese’ or ‘cake,’ in order to be found generic.”
1-2 Anne Gilson LaLonde, Gilson on Trademarks § 2.02[7][a] (2011).
204

We do not, of course, suggest that the term “churrascos” is necessarily


generic as to any and all restaurant services. Had another applicant applied for
registration of the mark CHURRASCOS in connection not with the entire broad
genus of restaurant services but instead with a narrower sub-genre of restaurant
at which grilled meat is not a key aspect of the service provided — for example,
vegetarian or sushi restaurants — the result could well have been different.
“[B]y expanding or contracting the definition of a ‘genus’ of products, a court
can substantially affect the final determination of whether a term is ‘generic.’”
2 McCarthy § 12:23. It is up to the applicant to identify the genus of goods or
services for which it seeks protection. The PTO will generally accept any identifi-
cation of goods or services so long as it is “specific, definite, clear, accurate, and
concise.” TMEP § 1402.01. . . .
Here, Cordua sought registration of the stylized form of CHURRASCOS
in connection with the broad genus of all restaurant services, and the question
of genericness must be evaluated accordingly. As the PTO points out, registra-
tion of the stylized form of CHURRASCOS on the Principal Register would give
Cordua rights that it could enforce against all others providing restaurant ser-
vices, including operators of traditional Latin American churrascarias (churrasco
restaurants) that specialize in meat grilled in the churrasco style. By seeking
broad protection for its mark, Cordua obliged the PTO to direct its genericness
inquiry to the broad category of restaurants generally.
. . .
We affirm the TTAB’s decision that the stylized form of CHURRASCOS
applied for in the ’191 Application is generic as applied to restaurant services
and therefore trademark-ineligible. . . .

NOTES AND QUESTIONS

1. Competitive interests.  Cordua opened his first “Churrascos” restaurant


in 1988. Would giving Cordua a monopoly on the word “Churrascos” give it an
unfair advantage in the marketplace? There are many cuisines that are popular
overseas but not in the United States. Does the doctrine of “foreign equivalents”
referenced in In re Cordua diminish incentives for entrepreneurs to introduce var-
ied global cuisines to American consumers? Are there other rewards for the first
restaurateur to popularize a type of cuisine that is unfamiliar to most Americans?
2. Vegetarian churrascarias?  The Federal Circuit says that while Cordua can-
not obtain a mark on the stylized form of “Churrascos,” it might have been able
to obtain a mark on the use of “Churrascos” for “vegetarian or sushi restaurants.”
Why might the result be different in such a case?
3. Genericide.  Generic terms may be generic from the outset (e.g., the
Multistate Bar Examination) or may start off as distinctive but become generic
over time (e.g., aspirin, zipper, yo-yo, or escalator) as ordinary people increasingly
use the mark as a synonym for the product itself. Companies with very valuable
marks that are in danger of becoming generic (such as Band-Aid for adhesive
bandages or Chapstick for lip balm) go to great lengths to prevent the genericide
205

of their marks. Consider the relationship between genericide and adverse pos-
session, to which you were introduced in Chapter 2. What are the key similarities
and differences between the doctrines?
4. The public domain generally.  We have now examined the public domain in
the context of land (the public trust doctrine), copyright (the purportedly finite
copyright term), and trademarks (no protection for generic marks). Note that
the implications of intellectual property being in the public domain are that any-
one can use the resource free of charge, but such a permissive access regime does
not exist in the context of the public trust doctrine. What explains the different
treatment? And is the public domain serving the same purposes in these diver-
gent settings? Think carefully about the benefits of protecting a vibrant public
domain in each context and the harms that result from prohibiting private par-
ties from controlling the rights to beaches, artistic works created decades ago, or
brand identifiers that have become generic. How well does the law balance what
resources can be privatized and what resources cannot be in each case?

C.  hat Ownership Entails: The Rights to Exclude, Alienate,


W
Abandon, and Destroy

There is nothing which so generally strikes the imagination, and engages the affec-
tions of mankind, as the right of property; or that sole and despotic dominion which
one man claims and exercises over the external things of the world, in total exclu-
sion of the right of any other individual in the universe.
William Blackstone,
Commentaries on the Laws of England, 1765-69

A life is sacred. Property is intended to serve life, and no matter how much we sur-
round it with rights and respect, it has no personal being. It is part of the earth man
walks on. It is not man.
Martin Luther King, Jr.,
The Trumpet of Conscience, 1968

1. The Right to Exclude and Its Limits

The law of trespass, introduced in Problem 2 on page 42, protects the right to
exclude, but then so too does the law of conversion at issue in Moore. Indeed, con-
version developed in part as a substitute for the old action of trespass to chattels
(chattels are personal property). So Moore can be seen to involve not just the right
to include, but also the right to exclude. On that latter right, consider briefly the
two cases that follow.
Jacque v. Steenberg Homes, Inc., 563 N.W.2d 154 (Wis. 1997). “Steenberg
Homes had a mobile home to deliver. Unfortunately for Harvey and Lois Jacque
(the Jacques), the easiest route of delivery was across their land. Despite adamant
206

protests by the Jacques, Steenberg plowed a path through the Jacques’ snow-cov-
ered field and via that path, delivered the mobile home. Consequently, the Jacques
sued Steenberg Homes for intentional trespass. Although the jury awarded the
Jacques $1 in nominal damages and $100,000 in punitive damages, the circuit
court set aside the jury’s award of $100,000. The court of appeals affirmed, reluc-
tantly concluding that it could not reinstate the punitive damages because . . .
an award of nominal damages will not sustain a punitive damage award. We con-
clude that when nominal damages are awarded for an intentional trespass to
land, punitive damages may, in the discretion of the jury, be awarded. . . .
“Steenberg determined that the easiest route to deliver the mobile home
was across the Jacques’ land. . . . [T]he only alternative was a private road which
was covered in up to seven feet of snow and contained a sharp curve which would
require sets of ‘rollers’ to be used when maneuvering the home around the
curve. Steenberg asked the Jacques on several occasions whether it could move
the home across the Jacques’ farm field. The Jacques refused. The Jacques were
sensitive about allowing others on their land because they had lost property val-
ued at over $10,000 to other neighbors in an adverse possession action in the
mid-1980’s. Despite repeated refusals from the Jacques, Steenberg decided to sell
the mobile home, which was to be used as a summer cottage, and delivered it on
February 15, 1994. . . . “[Steenberg’s] assistant manager asked Mr. Jacque how
much money it would take to get permission. Mr. Jacque responded that it was
not a question of money; the Jacques did not want Steenberg to cross their land.
Mr. Jacque testified that he told Steenberg to ‘[F]ollow the road, that is what the
road is for.’ . . .
“At trial, one of Steenberg’s employees testified that, upon coming out of
the Jacques’ home, the assistant manager stated: ‘I don’t give a _____ what [Mr.
Jacque] said, just get the home in there any way you can.’ The other Steenberg
employee confirmed this testimony and further testified that the assistant man-
ager told him to park the company truck in such a way that no one could get
down the town road to see the route the employees were taking with the home.
The assistant manager denied giving these instructions, and Steenberg argued
that the road was blocked for safety reasons.
“The employees, after beginning down the private road, ultimately used a
‘bobcat’ to cut a path through the Jacques’ snow-covered field and hauled the
home across the Jacques’ land to the neighbor’s lot. One employee testified that
upon returning to the office and informing the assistant manager that they had
gone across the field, the assistant manager reacted by giggling and laughing. . . .
When a neighbor informed the Jacques that Steenberg had, in fact, moved the
mobile home across the Jacques’ land, Mr. Jacque called the Manitowoc County
Sheriff’s Department. After interviewing the parties and observing the scene, an
officer from the sheriff’s department issued a $30 citation to Steenberg’s assistant
manager. . . .
“We turn first to the individual landowner’s interest in protecting his or her
land from trespass. The United States Supreme Court has recognized that the
private landowner’s right to exclude others from his or her land is ‘one of the
most essential sticks in the bundle of rights that are commonly characterized as
207

property.’ Kaiser Aetna v. United States, 444 U.S. 164, 176 (1979). . . . This court
has long recognized ‘[e]very person[‘s] right to the exclusive enjoyment of his
own property for any purpose which does not invade the rights of another per-
son.’ Diana Shooting Club v. Lamoreux, 114 Wis. 44, 59, 89 N.W. 880 (1902).
“Yet a right is hollow if the legal system provides insufficient means to pro-
tect it. . . . Harvey and Lois Jacque have the right to tell Steenberg Homes and any
other trespasser, ‘No, you cannot cross our land.’ But that right has no practical
meaning unless protected by the State, [and a nominal dollar] does not consti-
tute state protection.
“. . . A series of intentional trespasses, as the Jacques had the misfortune to
discover in an unrelated action, can threaten the individual’s very ownership of
land.
“In sum, the individual has a strong interest in excluding trespassers from
his or her land. . . .
“Society has an interest in punishing and deterring intentional trespassers
beyond that of protecting the interests of the individual landowner. Society has an
interest in preserving the integrity of the legal system. Private landowners should
feel confident that wrongdoers who trespass upon their land will be appropriately
punished. When landowners have confidence in the legal system, they are less
likely to resort to ‘self-help’ remedies. . . .”
State v. Shack, 277 A.2d 369 (N.J. 1971). “Defendants entered upon pri-
vate property to aid migrant farmworkers employed and housed there. Having
refused to depart upon the demand of the owner, defendants [were convicted of
trespassing].
“Before us, no one seeks to sustain these convictions. The complaints were
prosecuted in the Municipal Court and in the County Court by counsel engaged
by the complaining landowner, Tedesco. However Tedesco did not respond to
this appeal, and the county prosecutor, while defending abstractly the constitu-
tionality of the trespass statute, expressly disclaimed any position as to whether
the statute reached the activity of these defendants.
“Complainant, Tedesco, a farmer, employs migrant workers for his seasonal
needs. As part of their compensation, these workers are housed at a camp on his
property.
“Defendant Tejeras is a field worker for the Farm Workers Division of the
Southwest Citizens Organization for Poverty Elimination, known by the acronym
SCOPE, a nonprofit corporation funded by the Office of Economic Opportunity
pursuant to an act of Congress, 42 U.S.C.A. §§2861-2864. The role of SCOPE
includes providing for the ‘health services of the migrant farm worker.’
“Defendant Shack is a staff attorney with the Farm Workers Division of
Camden Regional Legal Services, Inc., known as ‘CRLS,’ also a nonprofit cor-
poration funded by the Office of Economic Opportunity pursuant to an act of
Congress, 42 U.S.C.A. §2809(a)(3). The mission of CRLS includes legal advice
and representation for these workers.
“Differences had developed between Tedesco and these defendants prior to
the events which led to the trespass charges now before us. Hence when defen-
dant Tejeras wanted to go upon Tedesco’s farm to find a migrant worker who
208

needed medical aid for the removal of 28 sutures, he called upon defendant
Shack for his help with respect to the legalities involved. Shack, too, had a mis-
sion to perform on Tedesco’s farm; he wanted to discuss a legal problem with
another migrant worker there employed and housed. Defendants arranged to go
to the farm together. Shack carried literature to inform the migrant farmworkers
of the assistance available to them under federal statutes, but no mention seems
to have been made of that literature when Shack was later confronted by Tedesco.
“Defendants entered upon Tedesco’s property and as they neared the camp
site where the farmworkers were housed, they were confronted by Tedesco who
inquired of their purpose. Tejeras and Shack stated their missions. In response,
Tedesco offered to find the injured worker, and as to the worker who needed
legal advice, Tedesco also offered to locate the man but insisted that the consulta-
tion would have to take place in Tedesco’s office and in his presence. Defendants
declined, saying they had the right to see the men in the privacy of their living
quarters and without Tedesco’s supervision. Tedesco thereupon summoned a
State Trooper who, however, refused to remove defendants except upon Tedesco’s
written complaint. Tedesco then executed the formal complaints charging viola-
tions of the trespass statute.
“The constitutionality of the trespass statute, as applied here, is challenged
on several scores. . . .
“These constitutional claims are not established by any definitive holding.
We think it unnecessary to explore their validity. The reason is that we are satis-
fied that under our State law the ownership of real property does not include
the right to bar access to governmental services available to migrant workers and
hence there was no trespass within the meaning of the penal statute. The policy
considerations which underlie that conclusion may be much the same as those
which would be weighed with respect to one or more of the constitutional chal-
lenges, but a decision in nonconstitutional terms is more satisfactory, because the
interests of migrant workers are more expansively served in that way than they
would be if they had no more freedom than these constitutional concepts could
be found to mandate if indeed they apply at all.
“Property rights serve human values. They are recognized to that end, and
are limited by it. Title to real property cannot include dominion over the destiny
of persons the owner permits to come upon the premises. Their well-being must
remain the paramount concern of a system of law. Indeed, the needs of the occu-
pants may be so imperative and their strength so weak, that the law will deny the
occupants the power to contract away what is deemed essential to their health,
welfare, or dignity.
“Here we are concerned with a highly disadvantaged segment of our society.
We are told that every year farmworkers and their families numbering more than
one million leave their home areas to fill the seasonal demand for farm labor in
the United States. The migrant farmworkers come to New Jersey in substantial
numbers. . . .
“The migrant farmworkers are a community within but apart from the local
scene. They are rootless and isolated. Although the need for their labors is evi-
dent, they are unorganized and without economic or political power. It is their
209

plight alone that summoned government to their aid. In response, Congress pro-
vided under Title III-B of the Economic Opportunity Act of 1964 (42 U.S.C.A.
§2701 et seq.) for ‘assistance for migrant and other seasonally employed farm-
workers and their families.’ . . .
“These ends would not be gained if the intended beneficiaries could be
insulated from efforts to reach them. It is in this framework that we must decide
whether the camp operator’s rights in his lands may stand between the migrant
workers and those who would aid them. The key to that aid is communication.
Since the migrant workers are outside the mainstream of the communities in
which they are housed and are unaware of their rights and opportunities and of
the services available to them, they can be reached only by positive efforts tailored
to that end. . . .
“A man’s right in his real property of course is not absolute. It was a maxim
of the common law that one should so use his property as not to injure the rights
of others. Although hardly a precise solvent of actual controversies, the maxim
does express the inevitable proposition that rights are relative and there must be
an accommodation when they meet. Hence it has long been true that necessity,
private or public, may justify entry upon the lands of another. . . .
“Thus approaching the case, we find it unthinkable that the farmer-employer
can assert a right to isolate the migrant worker in any respect significant for the
worker’s well-being. The farmer, of course, is entitled to pursue his farming activi-
ties without interference, and this defendants readily concede. But we see no
legitimate need for a right in the farmer to deny the worker the opportunity
for aid available from federal, State, or local services, or from recognized chari-
table groups seeking to assist him. Hence representatives of these agencies and
organizations may enter upon the premises to seek out the worker at his living
quarters. So, too, the migrant worker must be allowed to receive visitors there of
his own choice, so long as there is no behavior hurtful to others, and members of
the press may not be denied reasonable access to workers who do not object to
seeing them. . . .
“It follows that defendants here invaded no possessory right of the farmer-
employer. Their conduct was therefore beyond the reach of the trespass statute.
The judgments are accordingly reversed and the matters remanded to the County
Court with directions to enter judgments of acquittal.”

NOTES AND QUESTIONS

1. Two centuries after Blackstone characterized property rights in the


most expansive terms as “that sole and despotic dominion” (page 205), the U.S.
Supreme Court, in the Kaiser Aetna case cited and quoted in Jacque (see pages 206-
207), described the right to exclude as an essential feature of property. See also
Thomas W. Merrill, The Property Strategy, 160 U. Pa. L. Rev. 2061 (2012); Thomas
W. Merrill, Property and the Right to Exclude, 77 Neb. L. Rev. 730 (1998). Why
could the farmers in Jacque be despotic, but the farmer in Shack not?
210

2. Even in Blackstone’s time, there were limitations and caveats placed on


the right to exclude, and these were discussed in his Commentaries. See Carol M.
Rose, Canons of Property Talk, or, Blackstone’s Anxiety, 108 Yale L.J. 601 (1998).
Nowadays there are many more limits. Here is a list of just some of the examples
you will encounter or have already encountered in this book: civil rights legisla-
tion forbidding various forms of discrimination; rent controls and other limita-
tions on a landlord’s right to evict tenants; the law of adverse possession; bodies
of doctrine granting public rights of access to private beaches; legislation protect-
ing homeowners who have defaulted on mortgage payments.
Laws in many American states and European nations have even protected
the public’s right to roam on unimproved, privately owned land. See Gregory S.
Alexander, The Sporting Life: Democratic Culture and the Historical Origins of
the Scottish Right to Roam, 2016 U. Ill. L. Rev. 321; John A. Lovett, Progressive
Property in Action: The Land Reform (Scotland) Act 2003, 89 Neb. L. Rev. 739
(2011); Brian Sawers, The Right to Exclude from Unimproved Land, 83 Temple
L. Rev. 665 (2011). A recent empirical study examined the effects of Great
Britain’s expansion of the public right to roam in some parts of the nation. It
found that rural property that was newly subjected to greater public access rights
declined in value by a statistically significant figure compared to land where pub-
lic access rights were not expanded. See Jonathan Klick & Gideon Parchomovsky,
The Value of the Right to Exclude: An Empirical Assessment, 165 U. Pa. L. Rev.
917 (2017).
Recall that Morris Cohen addressed the relationships between property and
power in his essay on Property and Sovereignty, published on the eve of the Great
Depression (see Note 6 on page 18). Acknowledging that “the essence of private
property is always the right to exclude others,” Cohen nevertheless maintained
that it should not be regarded as inviolable. To the contrary, Cohen argued, “the
right of property must be supported by restrictions or positive duties on the part
of the owners, enforced by the state as much as the right to exclude others which
is the essence of property.” Some 50 years later, C.B. Macpherson argued in a
similar vein that the right to exclude is no more the essence of property — as a
matter of logic or as a matter of propriety — than the right not to be excluded (as in
the case of common property, which figured throughout the preceding section
of this chapter). And when property is so understood, he said, the problem is no
longer one “of putting limits on the property right, but of supplementing the
individual right to exclude others by the individual right not to be excluded by
others.” This latter right “may provisionally be stated as the individual right to
equal access to the means of labour and/or the means of life.” C.B. Macpherson,
Property: Mainstream and Critical Positions 201 (1978).
A related but more general argument is set out in Gregory S. Alexander,
The Social-Obligation Norm in American Property Law, 94 Cornell L. Rev. 745
(2009). Alexander sees in American property law, on both the private and public
sides, a social-obligation norm imposing on all individuals a duty to promote the
capabilities essential to human flourishing — meaning, as to property owners, a
duty sometimes to share their surplus resources with the needy. Indeed, in the
last decade, progressive property theorists have emphasized the social character
211

of property. They reject the notion that the right to exclude is essential to own-
ership, and consider property’s social nature as key to understanding property
relations. They argue that ownership is a matter of obligations as well as rights,
championing ideas like the right to roam. They also reject the idea that any one
value or good is the foundation of property, arguing in favor of a pluralist con-
ception of property that includes multiple goods such as individual autonomy,
personhood, security, equal dignity, and community. See Gregory S. Alexander et
al., A Statement of Progressive Property, 94 Cornell L. Rev. 743 (2009); Eduardo
M. Peñalver, Land Virtues, 94 Cornell L. Rev. 821 (2009); Nadav Shoked, The
Duty to Maintain, 64 Duke L.J. 437 (2014); Joseph William Singer, Democratic
Estates: Property Law in a Free and Democratic Society, 94 Cornell L. Rev. 1009
(2009). Progressive property theory (PPT) has not gone unchallenged. See the
Responses in the Special Issue: Property and Obligation, in 94 Cornell L. Rev.
889-1007 (2009) (Responses by Eric R. Claeys, Jedediah Purdy, Henry E. Smith,
and Katrina M. Wyman). See also Ezra Rosser, The Ambition and Transformative
Potential of Progressive Property, 101 Cal. L. Rev. 107 (2013) (criticizing PPT for
neglecting issues of race-related acquisition and distribution); Jane B. Baron, The
Contested Commitments of Property, 61 Hastings L. Rev. 917 (2010) (criticizing
PPT’s focus on exclusion, arguing that the real contest between progressive and
exclusion theorists is metaphorical — a “machine” metaphor of property versus a
“conversation” metaphor).
3. There is, of course, an opposing point of view that extols the virtues of
unrestricted rights to exclude. Richard A. Epstein, for example, speaks in defense
of a firm right to exclude in two essays: Rights and “Rights Talk” (Book Review),
105 Harv. L. Rev. 1106 (1992), and Property and Necessity, 13 Harv. J.L. & Pub.
Poly. 2 (1990). “What is wrong,” Professor Epstein asks, “with a system of absolute
rights that allows individuals to exclude some persons on a whim and admit oth-
ers only by mutual consent?” His answer: “By and large, nothing,” because by and
large absolute rights simply establish the conditions for subsequent market trans-
actions. Buyers and sellers may deal as they see fit, but so long as there are many
buyers and sellers market forces will check abuse. “Those who exercise absolute
rights in a capricious fashion pay for their folly by losing their markets.” Epstein,
Rights and “Rights Talk,” supra, at 1109. Epstein argues that narrow limitations
on the right to exclude are appropriate only when conditions (such as monop-
oly) create obstacles to market transactions. Epstein, Property and Necessity,
supra, at 7. This approach might leave some people out in the cold, but avoiding
that problem comes at the cost “of forcing individuals to open their property to
persons whom they would prefer, for whatever reason, to exclude.” Id. Other
scholarship, by contrast, wonders whether strong rights to exclude contribute to
human flourishing, given the close connection among sharing, selfless acts, and
human happiness. See David Fagundes, Why Less Property is More: Inclusion,
Dispossession, & Subjective Well-Being, 103 Iowa L. Rev. __ (forthcoming 2018),
available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3014320.
Does vindicating the right to exclude necessitate embracing solitary and anti-
social uses of property? See Lior Jacob Strahilevitz, Information and Exclusion
28-38 (2011).
212

4. Intellectual property law and the right to exclude. Patent rights are often
described as rights to exclude others from making or using an invention without
the patent holder’s permission. Suppose that an inventor patents a mousetrap
and begins selling it. Then suppose that the same inventor comes up with an
idea for a new-and-improved mousetrap and obtains a patent on it as well. The
inventor decides to neither make nor sell the better mousetrap. Moreover, the
inventor refuses to license the improved invention to competitors, and files an
infringement suit against a competitor that tries to sell the improved version to
consumers. The inventor figures that he is already making enough profits off the
previous version of the mousetrap, which is still the best mousetrap on the mar-
ket, so he will continue selling the old version until its patent expires. Only then
will the inventor begin selling the new-and-improved mousetrap to consumers.
Does patent law protect the inventor’s right to exclude competitors from making
and selling the new-and-improved invention, even if the inventor is using it purely
for “blocking” purposes? The Supreme Court has answered that question in the
affirmative, repeatedly. See, e.g., Continental Paper Bag Co. v. Eastern Paper Bag
Co., 210 U.S. 405 (1908); Special Equip. Co. v. Coe, 324 U.S. 370 (1945). And
Congress has not disturbed its judgment. See 35 U.S.C. § 271(d)(4).
In United States v. American Bell Tel. Co., 167 U.S. 224 (1897), the Court
embraced an absolutist conception of the patentee’s right to exclude. “Counsel
seem to argue that one who has made an invention, and thereupon applies for a
patent thereof, occupies . . . the position of a quasi trustee for the public; that he
is under a sort of moral obligation to see that the public acquires the right to the
free use of that invention as soon as is conveniently possible. We dissent entirely
from the thought thus urged. The inventor is the one who has discovered some-
thing of value. It is his absolute property. He may withhold the knowledge of it
from the public, and he may insist upon all the advantages and benefits which
the statute promises to him who discloses to the public his invention.” Id. at 250.
Nearly half a century later, three dissenting justices in Special Equipment Company
worried that the majority had gone astray by reaffirming Continental Paper Bag’s
rule:

It is a mistake therefore to conceive of a patent as but another form of private


property. The patent is a privilege conditioned by a public purpose. The public
purpose is to promote the Progress of Science and useful Arts. The exclusive right
of the inventor is but the means to that end. . . . But the Paper Bag case marked a
radical departure from that theory. It treated the exclusive right of the inventor as
something akin to an absolute right. . . . The result is that suppression of patents
has become commonplace. Patents are multiplied to protect an economic barony
or empire, not to put new discoveries to use for the common good. It is common
practice to make an invention and to secure a patent to block off a competitor’s
progress. . . . A whole technology is blocked off. The result is a clog to our economic
machine and a barrier to an economy of abundance. It is difficult to see how that
use of patents can be reconciled with the purpose of the Constitution. . . . [T]he
Court sits as a court of equity. It should withhold its aid from a patentee who has
employed or plans to employ the patent not to exploit the invention but to suppress
it in order to protect another invention.  .  .  . If that purpose were clear, a patent
should not issue in the first instance.
213

Special Equip. Co., 324 U.S. at 382-84 (Douglas, J., dissenting). Is there a persuasive
response to the views expressed in Justice Douglas’s dissent? Do any of Justice
Ginsburg’s arguments from Eldred (page 187) help? How well do arguments for
a strong right to exclude in the real property context (as in Jacque) translate to
patent law?

2. The Right to Transfer, and Restraints on Alienation

Much of the importance of the right to exclude stems from the supportive role
that the right plays with respect to the use of land. If an owner lacks the right
to exclude outsiders from coming onto her property, then her rights to use or
transfer the property are substantially diminished. A large part of this book deals
with use rights, but let us pause to consider the right to transfer for the moment.
Frequently, someone will want to limit subsequent transfers of property by its
current or prospective owner. They might wish to impose these limits because
of a concern about who will occupy land or how it might be used by different
people. When this happens, the law often objects, on the grounds that restraints
on alienation may hamper the ability of the property regime to see to it that
each resource is eventually possessed by the person or entity that can put it to its
highest and best use. Indeed, getting resources to their highest and best users is
a major theme in the law of property. Along those lines, consider the following
cases.

Davis v. Davis
Court of Appeals of North Carolina, 2016
791 S.E.2d 714

Dillon, J., This matter involves a family dispute over a beach property in
Dare County (the “Property”). Defendant Dorothy C. Davis owns a life estate
in the Property. The remainder interest is held by nominal Defendant MKR
Development, LLC (the “LLC”), a limited liability company owned by and ben-
efitting three of Mrs. Davis’s children — Kaye Davis and Plaintiffs Melvin L. Davis,
Jr., (“Mel”) and J. Rex Davis (“Rex”). Plaintiffs commenced this suit to enjoin
Mrs. Davis from renting the Property during her lifetime to vacationers, contend-
ing that certain language in the deed conveying Mrs. Davis her life estate interest
(the “Deed”) restricts her from renting out the Property.
. . .
Sometime in the 1980s, Mrs. Davis and her husband (“Mr. Davis”) purchased
the Property. In order to help pay for Property expenses, Mr. and Mrs. Davis occa-
sionally rented the Property to vacationers through a real estate agency.
In 2009, Mr. and Mrs. Davis decided to transfer a remainder interest in the
Property to three of their children (including Plaintiffs). Accordingly, Mr. and
Mrs. Davis executed the Deed and conveyed a remainder interest in the Property
to the LLC, reserving for themselves (Mr. and Mrs. Davis) a life estate.
214

In July 2012, Mr. Davis died, leaving Mrs. Davis as the Property’s sole life ten-
ant. Less than two weeks later, Plaintiffs prepared a letter advising their mother
that the Deed required that the Property “remain available for [her] personal use
and [could] not be used to provide income to [her].”
  Notwithstanding this letter, Mrs. Davis entered into an agreement with a
real estate agency in 2013 to rent the Property to vacationers, just as she and her
husband had done in years past.
 In July 2013, Plaintiffs filed this declaratory judgment action to enjoin their
mother from renting the Property without the express permission of the LLC.
 In May 2015, both parties filed summary judgment motions. Judge McGuire
granted Mrs. Davis’s summary judgment motion. Plaintiffs timely appealed.
On appeal, Plaintiffs argue that the Deed contains a restriction which
prevents their mother from renting out the Property during her life tenancy.
Specifically, they point to the following language in the Deed:

The Grantors [Mr. and Mrs. Davis] hereby reserve unto themselves, a life estate in
the Property, said life estate to be personal to the use of the Grantors, or the survivor
thereof, and may not be utilized by any other person, nor may it be reduced to a
cash value for the benefit of the Grantors, or the survivor thereof, but must remain
always during the lifetime of said Grantors, or the survivor thereof, available for
their individual and personal use without interference from either the remainder-
men or any other person.

We disagree. We hold that the Deed language creates an unreasonable


restraint on the alienation of Mrs. Davis’s life estate and is therefore void.
Accordingly, we affirm Judge McGuire’s summary judgment order.
Restraints on alienation are generally disfavored in North Carolina due to
the “necessity of maintaining a society controlled primarily by its living members
and the desirability of facilitating the utilization of wealth.” Smith v. Mitchell, 269
S.E.2d 608, 611 (N.C. 1980). Nevertheless, it is fundamentally important that a
property owner “should be able to convey [property] subject to whatever condi-
tion he or she may desire to impose on the conveyance.” Id.
 To balance these competing policy interests, our Supreme Court has held
that any unlimited restraint on alienation “is per se invalid.” Id. However, restric-
tions which “provide only that someone’s estate may be forfeited or be termi-
nated if he alienates, or that provides damages must be paid if he alienates, may
be upheld if reasonable.” Id. (emphasis added). That is, our courts will generally
uphold any reasonable restraints on alienation except unlimited restraints, which
are per se unreasonable.
 Our Supreme Court has applied this restraints doctrine to life estates. Lee
v. Oates, 88 S.E. 889, 891 (N.C. 1916). (“[T]his Court has for many years con-
sistently held that the doctrine as to restraints of alienation applies as well to
estates for life as to estates in fee simple[.]”). See also Crockett v. First Fed. Sav. &
Loan Assoc. of Charlotte, 224 S.E.2d 580, 583 (N.C. 1976) (reaffirming caselaw
that applies restraints doctrine to life estates); Pilley v. Sullivan, 109 S.E. 359, 360
(N.C. 1921) (“The clause which purports to ingraft upon the devise an unlimited
restraint on alienation is not only repugnant to the [life] estate devised, but is in
215

contravention of public policy, and therefore void.”); Wool v. Fleetwood, 48 S.E.


785, 787 (N.C. 1904) (voiding a will provision prohibiting the life tenant from
selling the life estate).
 In the present case, Plaintiffs concede that the Deed creates an unlimited
restraint on Mrs. Davis’s ability to alienate her life estate. Indeed, as noted in the
summary judgment order, “[P]laintiffs contend that not only is [Mrs. Davis] pro-
hibited from selling the life estate, she cannot rent or even permit others to use
the Property.” To justify this position, Plaintiffs aver that the caselaw prohibiting
unlimited restraints does not apply as Mrs. Davis is both the grantor who created
the restraint and the life tenant who is subject to the restraint. Plaintiffs con-
tend that Lee is distinguishable as the restraint at issue attached to a conveyance
between a grantor and a life tenant, whereas here, Mrs. Davis reserved a life estate
for herself and therefore voluntarily restricted that interest.
 We hold that whether the life estate was created by conveyance by a third party
or by reservation by the life tenant herself is irrelevant. An unlimited restraint is
against public policy; it makes no difference if the restraint is self-imposed. Plaintiffs
have failed to cite precedent, either from North Carolina or from another juris-
diction, that would recognize this distinction. Indeed, the adverse party in Lee
argued that the conveyance restraint should nonetheless be upheld as the life
tenant herself signed the deed, “thereby agree[ing] . . . not to alien her estate[.]”
Lee, 88 S.E. at 892. Our Supreme Court, however, rejected this argument, holding
that an otherwise invalid restraint on alienation is not validated merely because
the life tenant assented to the restraint by signing the instrument. . . . Based on
our Supreme Court’s reasoning in Lee, we conclude that the restraint on Mrs.
Davis’s ability to rent her Property is per se void even though Mrs. Davis was also
the person who created the restraint. We therefore affirm Judge McGuire’s order
granting summary judgment to Mrs. Davis.

NOTES AND QUESTIONS

1. A house divided?  Melvin Davis, Sr. and Dorothy Davis had four children:
Kaye, Tommy, and the two plaintiffs in this case, Melvin Jr., and Rex. Melvin Jr.,
Kaye, and Rex formed MKR for their joint real estate investment activities. There
was apparently some tension in the family, because Tommy’s siblings did not want
to own any property jointly with him, so he was not included in MKR. Melvin Sr.
and Dorothy wanted their four children to receive equal shares of their prop-
erty, hence they transferred the remainder interest in Davis to MKR. MKR paid
Melvin Sr. and Dorothy an amount equal to one-quarter of the land’s value, and
then Melvin Sr. and Dorothy used these proceeds to pay off a $270,000 debt that
Tommy owed, which had been secured by his home. See Davis v. Davis, 2015 WL
6180969, at *2 (N.C. Sup. Ct. 2015).
2. What were they thinking?  At the time they executed the transfer of the
remainder interest to MKR, Melvin Sr. and Dorothy were renting out the property
to a third party. Their lawyer, Donald Stokes, testified that he inserted language
that prohibited the life tenants from renting out the property to protect them
216

against creditors and to ensure that their life estate was not reduced to a mon-
etary amount in a subsequent legal action. You will examine the former concern
in the context of Sawada v. Endo (page 429) and the latter in the notes following
White v. Brown (pages 273-274). Given Melvin Sr. and Dorothy’s short life expec-
tancy, the economic value of their life estate would have been relatively small.
Stokes did not recall discussing with Melvin Sr. and Dorothy whether they would
be able to rent the property after transferring the remainder interest to MKR,
and there was nothing beside the text of the deed to indicate that Melvin Sr. and
Dorothy intended to preclude themselves from renting the property during their
lifetimes. See id. at *2-3. But for the court’s determination that the restraint on
alienation was invalid, Dorothy would have been bound by the deed provision she
apparently did not read closely or did not understand.
3. Public policy considerations.  Is there a good reason to limit the rights of an
owner to tie her hands by restraining her ability to alienate her own property?
Should it matter that Dorothy Davis was elderly, meaning that the restraint on
alienation at issue was unlikely to last a long time? We will consider related issues
of restraints on alienation again in Chapter 7, in the context of landlord-tenant
law. See Kendall v. Ernest Pestana, Inc., at page 490. For an ambitious effort to
make sense of the law regarding restraints on alienation, see Luke Meier & Rory
Ryan, Aggregate Alienability, 60 Vill. L. Rev. 1013 (2015).
It is not only in the real property context that the law expresses misgivings
about restraints on alienation. Similar doctrines arise in intellectual property con-
texts as well. Copyright’s first sale doctrine holds that once a copy of a copyrighted
work has been sold or otherwise lawfully transferred by the copyright holder,
the copyright holder’s right to control distribution of the work is exhausted. 17
U.S.C. § 1709(a); Kirtsaeng v. John Wiley & Sons, 568 U.S. 519 (2013). For exam-
ple, in Bobbs-Merrill Co. v. Straus, a publisher included a notation on the inside
cover of its books stating that reselling the books for less than one dollar a piece
amounted to copyright infringement. 210 U.S. 339 (1908). The defendants pur-
chased copies of the book from a wholesaler and then began selling them for
89 cents each, which triggered the publisher’s lawsuit. The Court ruled against
the publisher, noting that copyright protection did not encompass the rights the
publisher was seeking to assert, and Congress codified this result one year later.
As the following case indicates, similar issues arise under patent law.

Impression Products, Inc. v. Lexmark International, Inc.


Supreme Court of the United States, 2017
137 S. Ct. 1523

Chief Justice Roberts delivered the opinion of the Court.


A United States patent entitles the patent holder (the “patentee”), for a period
of 20 years, to “exclude others from making, using, offering for sale, or selling [its]
invention throughout the United States or importing the invention into the United
States.” 35 U.S.C. § 154(a). Whoever engages in one of these acts “without author-
ity” from the patentee may face liability for patent infringement. § 271(a).
217

When a patentee sells one of its products, however, the patentee can no
longer control that item through the patent laws — its patent rights are said to
“exhaust.” The purchaser and all subsequent owners are free to use or resell the
product just like any other item of personal property, without fear of an infringe-
ment lawsuit.
This case presents [a] question[ ] about the scope of the patent exhaustion
doctrine: . . . whether a patentee that sells an item under an express restriction
on the purchaser’s right to reuse or resell the product may enforce that restric-
tion through an infringement lawsuit. . . . We conclude that a patentee’s decision
to sell a product exhausts all of its patent rights in that item, regardless of any
restrictions the patentee purports to impose. . . .
The underlying dispute in this case is about laser printers — or, more spe-
cifically, the cartridges that contain the powdery substance, known as toner, that
laser printers use to make an image appear on paper. Respondent Lexmark
International, Inc. designs, manufactures, and sells toner cartridges to consum-
ers in the United States and around the globe. It owns a number of patents that
cover components of those cartridges and the manner in which they are used.
When toner cartridges run out of toner they can be refilled and used again.
This creates an opportunity for other companies — known as remanufactur-
ers — to acquire empty Lexmark cartridges from purchasers in the United States
and abroad, refill them with toner, and then resell them at a lower price than the
new ones Lexmark puts on the shelves.
Not blind to this business problem, Lexmark structures its sales in a way
that encourages customers to return spent cartridges. It gives purchasers two
options: One is to buy a toner cartridge at full price, with no strings attached.
The other is to buy a cartridge at roughly 20–percent off through Lexmark’s
“Return Program.” A customer who buys through the Return Program still owns
the cartridge but, in exchange for the lower price, signs a contract agreeing to
use it only once and to refrain from transferring the empty cartridge to anyone
but Lexmark. To enforce this single-use/no-resale restriction, Lexmark installs a
microchip on each Return Program cartridge that prevents reuse once the toner
in the cartridge runs out.
Lexmark’s strategy just spurred remanufacturers to get more creative. Many
kept acquiring empty Return Program cartridges and developed methods to
counteract the effect of the microchips. With that technological obstacle out of
the way, there was little to prevent the remanufacturers from using the Return
Program cartridges in their resale business. After all, Lexmark’s contractual
single-use/no-resale agreements were with the initial customers, not with down-
stream purchasers like the remanufacturers.
Lexmark, however, was not so ready to concede that its plan had been
foiled. In 2010, it sued a number of remanufacturers. . . . One group consists of
Return Program cartridges that Lexmark sold within the United States. Lexmark
argued that, because it expressly prohibited reuse and resale of these cartridges,
the remanufacturers infringed the Lexmark patents when they refurbished and
resold them. . . .
Eventually, the lawsuit was whittled down to one defendant, Impression
Products, and one defense: that Lexmark’s sales . . . exhausted its patent rights in
218

the cartridges, so Impression Products was free to refurbish and resell them. . . .
The District Court granted the motion as to the domestic Return Program
cartridges. . . .
The Federal Circuit considered the appeals en banc and ruled for
Lexmark. . . . Relying on its decision in Mallinckrodt, Inc. v. Medipart, Inc., 976
F.2d 700 (1992), the Federal Circuit held that a patentee may sell an item and
retain the right to enforce, through patent infringement lawsuits, “clearly com-
municated, . . . lawful restriction[s] as to post-sale use or resale.” 816 F.3d 721,
735 (2016). The exhaustion doctrine, the court reasoned, derives from the pro-
hibition on making, using, selling, or importing items “without authority.” Id.
at 734 (quoting 35 U.S.C. § 271(a)). When you purchase an item you presump-
tively also acquire the authority to use or resell the item freely, but that is just
a presumption; the same authority does not run with the item when the seller
restricts post-sale use or resale. 816 F.3d at 742. Because the parties agreed that
Impression Products knew about Lexmark’s restrictions and that those restric-
tions did not violate any laws, the Federal Circuit concluded that Lexmark’s sales
had not exhausted all of its patent rights, and that the company could sue for
infringement when Impression Products refurbished and resold Return Program
cartridges.
. . .
Judge Dyk, joined by Judge Hughes, dissented. In their view, selling the
Return Program cartridges in the United States exhausted Lexmark’s patent
rights in those items because any “authorized sale of a patented article . . . free[s]
the article from any restrictions on use or sale based on the patent laws.” Id. at
775-776. . . .
We granted certiorari to consider the Federal Circuit’s decisions . . . and now
reverse.
. . . We conclude that Lexmark exhausted its patent rights in [the Return
Program] cartridges the moment it sold them. The single-use/no-resale restric-
tions in Lexmark’s contracts with customers may have been clear and enforceable
under contract law, but they do not entitle Lexmark to retain patent rights in an
item that it has elected to sell.
The Patent Act grants patentees the “right to exclude others from making,
using, offering for sale, or selling [their] invention[s].” 35 U.S.C. § 154(a). For
over 160 years, the doctrine of patent exhaustion has imposed a limit on that
right to exclude. See Bloomer v. McQuewan, 14 How. 539, 14 L. Ed. 532 (1853).
The limit functions automatically: When a patentee chooses to sell an item, that
product “is no longer within the limits of the monopoly” and instead becomes the
“private, individual property” of the purchaser, with the rights and benefits that
come along with ownership. Id. at 549-550. A patentee is free to set the price and
negotiate contracts with purchasers, but may not, “by virtue of his patent, control
the use or disposition” of the product after ownership passes to the purchaser.
United States v. Univis Lens Co., 316 U.S. 241, 250 (1942) (emphasis added).
The sale “terminates all patent rights to that item.” Quanta Computer, Inc. v. LG
Electronics, Inc., 553 U.S. 617, 625 (2008).
This well-established exhaustion rule marks the point where patent rights
yield to the common law principle against restraints on alienation. The Patent
219

Act “promote[s] the progress of science and the useful arts by granting to [inven-
tors] a limited monopoly” that allows them to “secure the financial rewards” for
their inventions. Univis, 316 U.S. at 250. But once a patentee sells an item, it has
“enjoyed all the rights secured” by that limited monopoly. Keeler v. Standard
Folding Bed Co., 157 U.S. 659, 661 (1895). Because “the purpose of the patent
law is fulfilled . . . when the patentee has received his reward for the use of his
invention,” that law furnishes “no basis for restraining the use and enjoyment of
the thing sold.” Univis, 316 U.S. at 251.
We have explained in the context of copyright law that exhaustion has “an
impeccable historic pedigree,” tracing its lineage back to the “common law’s
refusal to permit restraints on the alienation of chattels.” Kirtsaeng v. John Wiley
& Sons, Inc., 568 U.S. 519, 538 (2013). As Lord Coke put it in the 17th century,
if an owner restricts the resale or use of an item after selling it, that restriction “is
voide, because . . . it is against Trade and Traffique, and bargaining and contract-
ing betweene man and man.” 1 E. Coke, Institutes of the Laws of England § 360,
p. 223 (1628); see J. Gray, Restraints on the Alienation of Property § 27, p. 18
(2d ed. 1895) (“A condition or conditional limitation on alienation attached to a
transfer of the entire interest in personalty is as void as if attached to a fee simple
in land.”).
This venerable principle is not, as the Federal Circuit dismissively viewed it,
merely “one common-law jurisdiction’s general judicial policy at one time toward
anti-alienation restrictions.” 816 F.3d at 750. Congress enacted and has repeat-
edly revised the Patent Act against the backdrop of the hostility toward restraints
on alienation. That enmity is reflected in the exhaustion doctrine. The patent
laws do not include the right to “restrain[ ] . . . further alienation” after an initial
sale; such conditions have been “hateful to the law from Lord Coke’s day to ours”
and are “obnoxious to the public interest.” Straus v. Victor Talking Machine Co.,
243 U.S. 490, 501 (1917). “The inconvenience and annoyance to the public that
an opposite conclusion would occasion are too obvious to require illustration.”
Keeler, 157 U.S. at 667.
But an illustration never hurts. Take a shop that restores and sells used cars.
The business works because the shop can rest assured that, so long as those bring-
ing in the cars own them, the shop is free to repair and resell those vehicles.
That smooth flow of commerce would sputter if companies that make the thou-
sands of parts that go into a vehicle could keep their patent rights after the first
sale. Those companies might, for instance, restrict resale rights and sue the shop
owner for patent infringement. And even if they refrained from imposing such
restrictions, the very threat of patent liability would force the shop to invest in
efforts to protect itself from hidden lawsuits. Either way, extending the patent
rights beyond the first sale would clog the channels of commerce, with little ben-
efit from the extra control that the patentees retain. And advances in technology,
along with increasingly complex supply chains, magnify the problem. See Brief
for Costco Wholesale Corp. et al. as Amici Curiae 7-9; Brief for Intel Corp. et al. as
Amici Curiae 17, n. 5 (“A generic smartphone assembled from various high-tech
components could practice an estimated 250,000 patents”).
This Court accordingly has long held that, even when a patentee sells an
item under an express restriction, the patentee does not retain patent rights in
220

that product. In Boston Store of Chicago v. American Graphophone Co., for


example, a manufacturer sold graphophones — one of the earliest devices for
recording and reproducing sounds — to retailers under contracts requiring those
stores to resell at a specific price. 246 U.S. 8, 17-18 (1918). When the manufac-
turer brought a patent infringement suit against a retailer who sold for less, we
concluded that there was “no room for controversy” about the result: By selling
the item, the manufacturer placed it “beyond the confines of the patent law,
[and] could not, by qualifying restrictions as to use, keep [it] under the patent
monopoly.” Id. at 20, 25.
Two decades later, we confronted a similar arrangement in United States v.
Univis Lens Co. There, a company that made eyeglass lenses authorized an agent
to sell its products to wholesalers and retailers only if they promised to market the
lenses at fixed prices. The Government filed an antitrust lawsuit, and the com-
pany defended its arrangement on the ground that it was exercising authority
under the Patent Act. We held that the initial sales “relinquish[ed] . . . the patent
monopoly with respect to the article[s] sold,” so the “stipulation . . . fixing resale
prices derive[d] no support from the patent and must stand on the same footing”
as restrictions on unpatented goods. 316 U.S. at 249-51.
It is true that Boston Store and Univis involved resale price restrictions that, at
the time of those decisions, violated the antitrust laws. But in both cases it was the
sale of the items, rather than the illegality of the restrictions, that prevented the
patentees from enforcing those resale price agreements through patent infringe-
ment suits. And if there were any lingering doubt that patent exhaustion applies
even when a sale is subject to an express, otherwise lawful restriction, our recent
decision in Quanta Computer, Inc. v. LG Electronics, Inc. settled the matter. In
that case, a technology company — with authorization from the patentee — sold
microprocessors under contracts requiring purchasers to use those processors
with other parts that the company manufactured. One buyer disregarded the
restriction, and the patentee sued for infringement. Without so much as men-
tioning the lawfulness of the contract, we held that the patentee could not bring
an infringement suit because the “authorized sale . . . took its products outside
the scope of the patent monopoly.” 553 U.S. at 638.
Turning to the case at hand, we conclude that this well-settled line of prec-
edent allows for only one answer: Lexmark cannot bring a patent infringement
suit against Impression Products to enforce the single-use/no-resale provision
accompanying its Return Program cartridges. Once sold, the Return Program
cartridges passed outside of the patent monopoly, and whatever rights Lexmark
retained are a matter of the contracts with its purchasers, not the patent law.
The Federal Circuit reached a different result largely because it got off on
the wrong foot. The “exhaustion doctrine,” the court believed, “must be under-
stood as an interpretation of” the infringement statute, which prohibits anyone
from using or selling a patented article “without authority” from the patentee. 816
F.3d at 734 (quoting 35 U.S.C. § 271(a)). Exhaustion reflects a default rule that a
patentee’s decision to sell an item “presumptively grant[s] ‘authority’ to the pur-
chaser to use it and resell it.” 816 F.3d at 742. But, the Federal Circuit explained,
the patentee does not have to hand over the full “bundle of rights” every time. Id.
at 741 (internal quotation marks omitted). If the patentee expressly withholds a
221

stick from the bundle — perhaps by restricting the purchaser’s resale rights — the


buyer never acquires that withheld authority, and the patentee may continue to
enforce its right to exclude that practice under the patent laws.
The misstep in this logic is that the exhaustion doctrine is not a presump-
tion about the authority that comes along with a sale; it is instead a limit on “the
scope of the patentee’s rights.” United States v. General Elec. Co., 272 U.S. 476,
489 (1926) (emphasis added). The right to use, sell, or import an item exists inde-
pendently of the Patent Act. What a patent adds — and grants exclusively to the
patentee — is a limited right to prevent others from engaging in those practices.
See Crown Die & Tool Co. v. Nye Tool & Machine Works, 261 U.S. 24, 35 (1923).
Exhaustion extinguishes that exclusionary power. See Bloomer, 14 How., at 549 (the
purchaser “exercises no rights created by the act of Congress, nor does he derive
title to [the item] by virtue of the . . . exclusive privilege granted to the patentee”).
As a result, the sale transfers the right to use, sell, or import because those are
the rights that come along with ownership, and the buyer is free and clear of an
infringement lawsuit because there is no exclusionary right left to enforce.
. . .
In sum, patent exhaustion is uniform and automatic. Once a patentee
decides to sell . . . that sale exhausts its patent rights, regardless of any post-sale
restrictions the patentee purports to impose. . . .
. . .
The judgment of the United States Court of Appeals for the Federal Circuit
is reversed, and the case is remanded for further proceedings consistent with this
opinion.
[Justice Ginsburg’s partial concurrence and partial dissent is omitted. Justice
Gorsuch took no part in the consideration of this case.]

NOTES AND QUESTIONS

1. The rest of the story.  The opinion drops hints that Impression Products v.
Lexmark is actually the latest chapter in a long-running campaign by Lexmark
to prompt its customers to only use its toner cartridges in their brand of print-
ers. In May of 1997, Lexmark launched its “prebate” plan, offering two kinds of
printer cartridges to customers. The prebate program was a similar precursor to
the Return Program discussed by the Chief Justice. For $288, customers could buy
a cartridge that came with no strings attached. When such a cartridge was used
up, customers could do whatever they wanted with it, including getting it refilled
by a remanufacturer. But for $258, customers could buy a prebate cartridge. That
cheaper cartridge was identical in every respect but one. Purchasers of the pre-
bate cartridge accepted a contract with this provision: “Following this initial use,
you agree to return the empty cartridge only to Lexmark for remanufacturing
and recycling.” To Lexmark’s dismay, some customers were purchasing the pre-
bate cartridges and then getting the toner refilled by remanufacturers, in breach
of the contracts. See Randal C. Picker, Copyright and the DMCA: Market Locks
and Technological Contracts, in Antitrust, Patents, and Copyright: EU and US
Perspectives 180, 183, 197-200 (Francois Leveque & Howard Shelanski eds., 2005).
222

After deciding that it shouldn’t sue thousands of printer owners for breach
of contract, Lexmark concluded that it needed to go after the remanufactur-
ers themselves. But it wasn’t in privity of contract with the remanufacturers. In
short, it needed an in rem theory rather than an in personam one.12 So its lawyers
came up with an intellectual property strategy. The Digital Millennium Copyright
Act of 1998 makes it unlawful to “circumvent a technological measure that effec-
tively controls access to a work protected” by copyright. 17 U.S.C. § 1701 (2017).
Lexmark developed “lockout” microchips that would track how many times a
printer cartridge had been used. When a customer purchased a refilled cartridge
directly from Lexmark, the microchip would tell the printer to print. But when
a customer purchased a prebate cartridge that had been refilled by a remanu-
facturer, the microchip would prevent the Lexmark printer from printing. Static
Control developed a chip that would mimic Lexmark’s lockout chip, and began
selling that chip to remanufacturers. Lexmark sued Static Control. See Lexmark
International Inc. v. Static Control Components, Inc., 387 F.3d 522 (6th Cir.
2004). While the Lexmark chips contained some software, the court ruled against
Lexmark. Invoking Feist, the court concluded that Lexmark was likely seeking to
protect a functional use of software, not any original expression. That was too big
of a stretch for copyright law.
With contract litigation impractical and copyright enforcement now off the
table, Lexmark’s lawyers came up with a new in rem strategy: patent enforcement.
But the Supreme Court has now closed that door. You can understand these three
sequential approaches as a case study of creative business lawyering. Lexmark
faced a practical problem, and its lawyers came up with clever, albeit ultimately
unsuccessful, strategies for furthering the company’s objectives via different
branches of contract and intellectual property law.
2. What is Lexmark’s pricing strategy?  This backstory raises a foundational
question: Why is Lexmark fighting so hard to maintain its pricing strategy?
Lexmark chooses to price its printers inexpensively and charge higher prices for
cartridges. Lexmark’s strategy for recouping its investments in research and devel-
opment and marketing left it vulnerable to cartridge remanufacturers. Shouldn’t
Lexmark just raise the cost of its printers and lower the costs of its cartridges
instead? See Erik Hovenkamp & Herbert Hovenkamp, Tying Arrangements and
Antitrust Harm, 52 Ariz. L. Rev. 925 (2010). Are there types of consumers who
would suffer if Lexmark and other printer manufacturers raised printer costs and
lowered cartridge costs? Consumers who would benefit? See Thomas F. Cotter,
The Procompetitive Interest in Intellectual Property Law, 48 William & Mary L.
Rev. 483, 546 (2006); Picker, supra, at 189-190.
3. Common law and patent law.  The Chief Justice relies heavily on common
law rules governing personal property restraints on alienation to inform his assess-
ment of the patent misuse doctrine. But, as the Davis court suggested, certain
restraints on alienation are permissible, as long as they are “reasonable.” See also
the Notes following White v. Brown (pages 272-273). A restraint on alienation that

12. In rem rights, such as property rights and intellectual property rights, are good against the entire
world. By contrast, in personam rights are typically good only against people in privity of contract with the rights
holder.
223

has a limited duration is more likely to be deemed reasonable, and these printer
cartridges don’t have particularly long shelf lives. So is the Court’s per se rule in
Impression Products consistent with the common law? See Herbert Hovenkamp,
Reasonable Patent Exhaustion, Univ. of Penn. Law Sch. Institute for Law & Econ.
Research Paper No. 17-29, at 19-21 (July 2017), available at https://papers.ssrn.
com/sol3/papers.cfm?abstract_id=2995751. Professor Hovenkamp points out
that Lexmark only has about a five-percent market share for laser printers, and
argues that in situations like that, tying arrangements like Lexmark’s probably
make customers as a whole better off. Id. at 4-5.
Now consider the relationship between real property cases like Davis and
intellectual property cases like Lexmark. Restraints on alienation are disfavored in
cases like Davis because they can prevent land from being occupied by its high-
est and best user. Would giving Lexmark a patent infringement cause of action
against Impression have a similarly undesirable effect? Are the economic and
litigation dynamics similar?

3. The Right to Abandon

The court in Shack was concerned that an owner of land might use his monopoly
over a resource to exercise dominion over people. Shack is hardly the only prop-
erty case in which courts worry about one person unilaterally exercising con-
trol over a resource in a way that might harm neighbors and other third parties.
Similar kinds of concerns were manifest in Davis and Impression Products. Perhaps
the two most controversial, and certainly the most extreme, rights in the bun-
dle of ownership are the rights to abandon property and to destroy property.
Both rights entail the unilateral relinquishment of property. As we shall see in
these next two sections, courts treat the abandonment and destruction of various
resources differently.

Hawkins v. Mahoney
Supreme Court of Montana, 1999
990 P.2d 776

Trieweiler, J. The Plaintiff, Sherman Hawkins . . . is an inmate at Montana State


Prison in Deer Lodge, Montana. On July 12, 1997, Hawkins escaped from the
prison. Immediately following his escape, Montana State Prison officials packed
up Hawkins’ personal property, sealed it with security tape, placed Hawkins’ name
on each box and removed the boxes from his cell. Hawkins’ personal property
was placed in the Montana State Prison storage room on July 12, 1997.
On July 14, 1997, two days after Hawkins escaped, Hawkins was apprehended
and returned to the prison. Upon his return, prison officials placed Hawkins
in administrative segregation in the maximum security unit. On July 20, 1997,
Hawkins was found guilty of escape following a Department of Corrections dis-
ciplinary hearing. He received the following sanctions: ten days in disciplinary
224

segregation, loss of good-time, and a recommendation for reclassification to the


maximum security unit. The disciplinary hearings officer did not order Hawkins’
personal property destroyed. During the next 30 days Hawkins requested the
return of his personal property several times.
In September 1997 prison officials escorted Hawkins to the storage room
and allowed Hawkins to remove all of his legal papers and legal materials from
the boxes of his personal property. Prison officials informed Hawkins that, by
policy, when an inmate escapes, all of his property is considered abandoned
and is subsequently destroyed. Prison officials then informed Hawkins that
his remaining personal property would either be destroyed or sold. Hawkins’
remaining property included: a television, stereo, word processor, eyeglasses and
books. Hawkins estimated that the approximate value of his personal property
was $2290. Sometime after September 1997, prison officials destroyed or sold
Hawkins’ remaining personal property.
Hawkins subsequently filed this action against five Montana State Prison
officials and the State of Montana and alleged that the individual Defendants
destroyed his property without affording him due process of law. . . . The District
Court concluded that Hawkins had abandoned his property by his escape and
that the abandonment constituted a complete defense to any action brought by
Hawkins which depended on his ownership of the property. . . .
Hawkins contends that the District Court erred in finding that, when he
escaped from the Montana State Prison, he abandoned his personal property
which he kept in his cell. Hawkins asserts that because he was returned to the
prison within two days, and the Defendants had his personal property in the
prison storage room, the Defendants should have returned the property to him
when he requested it.
The Defendants respond that Hawkins abandoned his property when he
escaped from prison and as a result of his abandonment, the Montana State
Prison became the owner of the property “to do with it as it pleased.”  Defendants
contend that Hawkins’ escape evidenced his intent to terminate his ownership of
the property, stating: “Hawkins, therefore, had a choice. He could keep his rights
to his property or he could escape. The choices are mutually exclusive; he could
not accomplish both.”
The District Court .  .  . relied on a 1989 Missouri Court of Appeals deci-
sion, Herron v. Whiteside, 782 S.W.2d 414 (Mo. App. 1989), to conclude that
Hawkins had abandoned his property. [The Herron court] held that a prisoner’s
escape from confinement constitutes, as a matter of law, abandonment of the
personal property the prisoner left at the prison. Id. at 416. In that case, during
Herron’s one day escape, prison officials allowed prison employees to give away
his property and allowed other inmates to take Herron’s property from his cell.
Id. at 415.
We . . . conclude that . . . Herron is factually distinguishable from this case.
In Herron, the prison employees and inmates ransacked Herron’s cell after he
escaped and appropriated Herron’s property for themselves. The state did not
take Herron’s personal property into protective custody after his escape. Whereas,
in this case, after Hawkins escaped from the prison, the Defendants removed
Hawkins’ personal property from his cell, placed his possessions in boxes with
225

Hawkins’ name on them and then placed the boxes in the prison storage room.
After Hawkins returned to the prison, he asked about his personal property and
asked that it be returned to him.
With regard to a former owner’s rights to abandoned property, it has been
stated that:

Personal property, upon being abandoned, ceases to be the property of any person,
unless and until it is reduced to possession with the intent to acquire title to, or
ownership of, it. Such property may, accordingly, be appropriated by anyone, if it
has not been reclaimed by the former owner, and ownership of it vests by operation of law,
in the person first lawfully appropriating it and reducing it to possession with the
intention to become its owner, provided such taking is fair.

1 C.J.S. Abandonment  §12 (1985) (emphasis added). In Gregg v. Caldwell-Guadalupe


Pick-Up Stations, 286 S.W. 1083, 1084 (Tex. Civ. App. 1926), the Texas court
stated: “[a]bandoned property is no man’s property until reduced to possession
with intent to acquire title.” . . . The intention must be discovered from all the
circumstances of the case. . . .
In this case there is no contention that Hawkins expressed an intention to
abandon his property. The intent was presumed or inferred when he left the
prison without taking the property with him. . . .
The intent to abandon property is a requisite element of abandonment.
If there is no expressed intent, then the intent may be inferred by the acts of
the owner. In Herron, the Missouri court held that a prisoner’s escape convinc-
ingly infers the intent to abandon property. Herron, 782 S.W.2d at 417. That court
essentially held that intent to abandon property is a conclusive presumption, or
an irrebuttable presumption. However, we know of no persuasive reason why
such a presumption should be conclusive prior to the time when possession of
the property is acquired by someone else with the intent to acquire ownership.
It does not appear, based on the facts we assume to be true, that at any point
after Hawkins’ escape and before Hawkins’ request for the return of his property,
that the Montana State Prison reduced Hawkins’ property to possession with the
intent to acquire title to, or ownership of it.
We conclude that the presumption or inference of intent to abandon one’s
property, based solely upon the acts of the owner, is a rebuttable presumption. . . .
Therefore, upon Hawkins’ return to the prison and request for his property prior
to it being claimed by anyone else, he effectively rebutted the presumption that
he ever intended to abandon his property. Accordingly, when Hawkins reclaimed
his property by requesting it be returned to him, Hawkins regained his status as
the owner of his personal property against all others. . . .
We conclude that the District Court erred when it held that Hawkins had
abandoned his personal property and had no right to request the return of his
personal property. . . . The judgment of the District Court is reversed and this
case is remanded to the District Court for further proceedings consistent with
this opinion.
[The dissenting opinions of Justice Gray and Chief Justice Turnage are
omitted.]
226

POSTSCRIPT
You might expect that after Hawkins, the Montana prisons would simply
alter their rules to make it clear that the property of prisoners who attempt
escape would be immediately forfeited to the state. In a twist, it turns out
that Montana didn’t need to do that, because they already had such a policy
in place! On remand, Montana pointed the court to Montana State Prison
Policy 09-013, which was on the books at the time of Hawkins’ escape,
and which provides: “When an inmate leaves the institution on escape . . .
property will be turned over to Department Investigators. The property
will be considered contraband and will be confiscated and sold at auction
or destroyed if not suitable for sale.” After learning of this policy, the trial
court granted the state’s motion for summary judgment. Hawkins appealed
to the Montana Supreme Court again, which now ruled against him.
Hawkins v. Montana State Prison, 102 P.3d 2 (Mont. 2004) (Hawkins II).
In Hawkins II, the state supreme court pointed out that because its earlier
decision reversed a motion to dismiss granted by the trial court before the
state had filed its answer to Hawkins’ complaint, the state could raise the
policy defense on remand and was not precluded from doing so by the law
of the case. That result is open to question, since the Hawkins I court’s basis
for distinguishing Herron was Montana’s lack of a policy similar to the one
adopted in Missouri. Alas, Hawkins was litigating the case pro se and was
unsympathetic. He wound up getting no compensation for his property.

NOTES AND QUESTIONS

1. More on Hawkins. The common law elements of abandonment are (1) the
owner must intend to relinquish all interests in the property, with no intention
that it be acquired by any particular person, and (2) there must be a voluntary act
by the owner effectuating that intent. As we saw in Popov (page 46), abandoned
property belongs to the first person who subsequently takes control of it. The
court holds that Hawkins did not abandon his property upon escaping prison
because he was able to rebut an inference that he intended to abandon the per-
sonal property. Is there a better way to make sense of the sequence of events
described in the case, whereby Hawkins escapes without his property, the prison
places the property in boxes with Hawkins’s name on them, and Hawkins asks
for the property’s return after being apprehended? See Lior Jacob Strahilevitz,
The Right to Abandon, 158 U. Pa. L. Rev. 355, 376 (2010). Should the major-
ity have taken into consideration the state’s policy interest in deterring prison
escape attempts? Are such considerations something that an inmate pondering
an escape would contemplate?
2. Is taking out the trash abandonment?  Suppose a business throws away vari-
ous documents, including a list of all its employees and their home addresses.
A union organizer removes the documents from the dumpster and then con-
tacts the employees at their home addresses as part of a unionization campaign
at the business. What result? Compare Long v. Dilling Mechanical Contractors,
227

705 N.E.2d 1022 (Ind. App. 1999) (no criminal liability because Dilling aban-
doned items placed in its dumpster), with Sharpe v. Turley, 191 S.W.3d 362 (Tex.
App. 2006) (an owner who deposits trash in a dumpster does not abandon it,
but is instead transferring it to the waste hauling firm with whom the owner has
contracted).
Disputes involving personal property that someone mistakenly thinks is
abandoned are pretty common. See, e,g., Mwangi v. Federal Nat’l Mortgage
Ass’n, 162 F. Supp. 3d 1315, 1327 (N.D. Ga. 2016) (personal property left in
home after foreclosure sale); Commonwealth v. Liebenow, 20 N.E.3d 242, 245-251
(Mass. 2014) (construction debris). For an exploration of the burdens imposed
on people who have to decide whether property is abandoned, lost, or some-
thing else, see Matt Corriel, Comment, Up for Grabs: A Workable System for the
Unilateral Acquisition of Chattels, 161 U. Pa. L. Rev. 807 (2013).

Pocono Springs Civic Association, Inc. v. MacKenzie


Superior Court of Pennsylvania, 1995
667 A.2d 233

Rowley, J. The issue in this appeal is whether real property owned by appellants
Joseph W. MacKenzie and Doris C. MacKenzie has been abandoned, as they
claim. In an order entered January 5, 1995, the trial court granted summary
judgment, in the amount of $1,739.82, in favor of appellee Pocono Springs Civic
Association, Inc., which argued successfully to the trial court that appellants had
not abandoned their property located in appellee’s development, and, therefore
appellants were still obligated to pay association fees.13
. . . [T]he facts are in no manner disputed. Our determination, therefore, is
simply whether the trial court erred as a matter of law in finding that appellee’s
right to summary judgment is clear and free from doubt.
We briefly outline the facts and procedural background of the case as fol-
lows: Appellants purchased a vacant lot at Pocono Springs Development, located
in Wayne County, on October 14, 1969. In 1987, appellants decided to sell their
still-vacant lot. A subsequent offer for the purchase of appellants’ lot was con-
ditioned upon the property being suitable for an on-lot sewage system. Upon
inspection, the lot was determined to have inadequate soil for proper percola-
tion, and appellants’ sale was lost. Believing their investment to be worthless,
appellants attempted to abandon their lot at Pocono Springs Development.

13. The covenant upon which appellee relies reads as follows:


An association of all property owners is to be formed by the Grantor and designated by such name
as may be deemed appropriate, and when formed, the buyer covenants and agrees that he, his executors,
heirs and assigns, shall be bound by the by-laws, rules and regulations as may be duly formulated and
adopted by such association and that they shall be subject to the payment of annual dues and assessments
of the same.
Deed, Covenant Number 11. [We will cover covenants in much more detail in Chapter 11. In essence, a cov-
enant is a promise concerning the use of the land that binds not only the party making the promise, but also
subsequent owners of the same real estate. The law refers to this binding of successors in interest as the covenant
“running with the land.”– Eds.]
228

Appellants claimed that because they successfully abandoned their lot, they are
relieved from any duty to pay the association fees sought by appellee. The trial
court held, however, that the appellant’s abandonment defense is “not a valid
defense.” We agree with the trial court, and affirm. . . .
Appellants’ argument, that they successfully abandoned their lot at Pocono
Springs Development, is based upon several actions that they believe disassoci-
ate them from the land. First, appellants, after learning that the lot would not
meet township sewage requirements, attempted to turn the lot over to appellee.
Appellee declined to accept the property. Second, appellants tried to persuade
appellee to accept the lot as a gift, to be used as a park-like area for the commu-
nity. Appellee again declined. Third, in 1986 appellants ceased paying real estate
taxes on their lot, and in 1988 the Wayne County Tax Claim Bureau offered the
property for sale, due to delinquent tax payments. There were no purchasers.
Fourth, in 1990, the lot was again offered for sale by the Tax Claim Bureau. The
property again was not sold. The Bureau then placed the lot on its “repository”
list. Fifth, appellants signed a notarized statement, mailed to “all interested par-
ties,” which expressed their desire to abandon the lot. Sixth, appellants do not
accept mail regarding the property. These occurrences, together with appellants
having neither visited the lot nor utilized the development’s services since 1986,
cause appellants to “assert that they do not have ‘perfect’ title to Lot #20, in
Pocono Springs [Development,] [thus] they can and have abandoned said prop-
erty back to the sovereign.” On the basis of the above, appellants argue that their
conduct manifests an intent to abandon, and that their intent to abandon should
be a question of fact which precludes summary judgment.
The law of abandonment in Pennsylvania does not support appellants’ argu-
ment. This Court has held that abandoned property is that:

to which an owner has voluntarily relinquished all right, title, claim and possession
with the intention of terminating his ownership, but without vesting it in any other
person and with the intention of not reclaiming further possession or resuming
ownership, possession or enjoyment.

Commonwealth v. Wetmore, 447 A.2d 1012, 1014 (Pa. Super. 1982). However,
in the instant case, appellants have not relinquished their rights, title, claim and
possession of their lot. They remain owners of real property in fee simple, with a
recorded deed and “perfect” title. Absent proof to the contrary, possession is pre-
sumed to be in the party who has record title. Overly v. Hixson, 82 A.2d 573 (Pa.
Super. 1951). As appellants themselves concede, with commendable candor, no
authority exists in Pennsylvania that allows for the abandonment of real property
when owned in fee simple with perfect title.14 Yet, appellants nonetheless main-
tain that their non-use, refusal to pay taxes, and offers to sell create an abandon-
ment, because of a displayed intent to abandon.
. . . [T]he record shows that they have retained “perfect” title to their lot.
Neither title nor deed has been sold or transferred.  .  .  . Perfect title, under
Pennsylvania law, cannot be abandoned. O’Dwyer v. Ream, 136 A.2d 90 (Pa.

14. Most commonly, abandonment involves personal property or railway lines not owned in fee simple.
229

1957). In O’Dwyer, our Supreme Court held that once it is determined that good
title exists, then the abandonment theory cannot succeed. See also A. D. Graham
& Company, Inc. v. Pennsylvania Turnpike Commission, 33 A.2d 22, 29 (Pa. 1943)
(which held that the doctrine of abandonment does not apply to perfect titles,
only to imperfect titles). Appellants do not cite, and our own research has not
discovered, any more recent cases that would cause us to question the authority
of the cited decisions. Absent authority to support their argument, therefore, the
appeal cannot be successful for appellants.
Appellants further claim that the trial court erred in granting summary
judgment because whether they abandoned their lots should be a question of
intent, for a jury to determine. . . . In the instant case, appellants’ intent is irrel-
evant. What is controlling is our law, which states that real property cannot be
abandoned. The law, therefore, leaves nothing for a jury to decide on this claim,
which amounts to a legal impossibility.
. . . Therefore, we are constrained to find that appellee is entitled to judg-
ment as a matter of law.

NOTES AND QUESTIONS

1. In feudal times, all land tenants owed a service to the lord, which was con-
tracted for when the lord granted the land to the original tenant and bound heirs
and assignees (see pages 250-254). Land could not be abandoned, because such
abandonment would mean no one was obligated to perform service to the lord
while the land was unowned. The modern equivalent of these feudal incidents
are property taxes (and in the case of land in a homeowners’ association like
Pocono Springs, assessments). In the modern era, should we expect that valuable
real estate that has been abandoned will remain unclaimed, such that no one will
be responsible for paying property taxes on it, for long?
2. Note the contrast between Pocono Springs and Hawkins. Pennsylvania, like
every other American state, holds that a fee simple interest in land cannot be
abandoned. Montana, like every other American state, holds that personal prop-
erty may be abandoned. What explains American law’s permissive attitude with
respect to the abandonment of personal property and simultaneous prohibition
on the abandonment of real property? The question is explored in two law review
articles that appeared a few months apart, Lior Jacob Strahilevitz, The Right to
Abandon, 158 U. Pa. L. Rev. 355 (2010), and Eduardo Peñalver, The Illusory
Right to Abandon, 109 Mich. L. Rev. 191 (2010).
Strahilevitz argues that the per se prohibition on the abandonment of real
estate arose for historical reasons, but cannot be justified presently any more
than a ban on the abandonment of personal property could be justified. To
Strahilevitz, the relevant question is whether the property in question has posi-
tive economic value (in which case abandonment usually ought to be permitted)
or negative economic value (in which case abandonment usually ought to be
prohibited). Strahilevitz argues that the costs of permitting abandonment (which
include confusion about whether it may be claimed by third parties, deteriora-
tion of a resource’s value while it is unowned, violent squabbles as people race to
230

acquire an abandoned resource, and concerns that neighbors or the state may
be responsible for disposing of or cleaning up a resource) are equally applicable
to real property and personal property alike. So too are the benefits associated
with abandonment (primarily that it facilitates the transfer of a resource from
someone who does not value it very highly to someone who does, that it allows an
owner to transfer a resource without having to devote effort to discovering who
might want or deserve it, and that the availability of a right to abandon a resource
may prevent an owner from exercising his right to destroy or deplete a resource).
Indeed, concludes Strahilevitz, because land is immobile and comes along with
a comprehensive system for recording who owns what (see pages 661-667), the
case for permitting the abandonment of positive-value real estate is stronger than
the case for permitting the abandonment of positive-value personal property. Do
you see why?
Peñalver, by contrast, approaches the puzzle by arguing that while the aban-
donment of personal property is theoretically permitted by the common law, as a
practical matter personal abandonment rarely, if ever, occurs. He posits that the
prohibition on the abandonment of land precludes the lawful abandonment of
personal property by depriving would-be abandoners of a location where they can
leave abandoned property. Strahilevitz responds to this point by suggesting that
governments often permit personal abandonment to occur on public land (for
example, the National Park Service promotes geocaching on some of its land),
that private owners may do the same (such as book swap rooms in dormitories),
and that private landowners frequently abandon personal property on their own
land (for example, a landowner who leaves firewood on her front lawn with a sign
that says, “take as much wood as you can carry”). Peñalver retorts that the con-
sensual, not unilateral, nature of some of these transfers makes it inappropriate
to characterize them as true abandonment. More broadly, Peñalver suggests that
the common law’s hostility to abandonment is grounded in deeply embedded
norms of social obligation that permeate American property law. Walking away
from land entails walking away from duties owed to others without their permis-
sion, with no guarantee that a new steward for the land will show up to assume an
owner’s obligations.
3. What would you advise the MacKenzies to do to stop the hemorrhaging
of cash?
4. Further background on Pocono Springs. We corresponded with the
MacKenzie daughters, Sandra M. Lloyd and Holly Carlson. According to Lloyd
and Carlson, their grandmother gave the MacKenzies a gift of money so that they
could purchase the property in Pocono Springs. They bought it under the mis-
taken impression that the land could be developed for residential purposes. The
MacKenzies felt compelled to litigate because they were advised by counsel that
without a favorable ruling from the court, the property would “become the ulti-
mate family white elephant,” one that would eventually burden their daughters.
Following a telephone conversation with the attorney for the MacKenzies, Dean
Peñalver reported to us that of 3,000 lots in the Pocono Springs development,
only about 400 proved capable of development. The other lots remained vacant
as of 2010. The attorney stated that the association’s board was dominated by a
231

few individuals who had been able to build on their lots. They would not accept
land from the owners who were unable to build. After extensive litigation, the
MacKenzies and other owners refused to pay their judgments. Most of them were
of retirement age and not concerned about their credit ratings. The attorney
reported that only about 10 percent of the owners paid the assessments; the rest
just walked away.
5. IP abandonment. The Lanham Act considers a mark abandoned when “its
use has been discontinued with intent not to resume such use.” 15 U.S.C. § 1127.
It also provides that such intent may be inferred and that “nonuse for three con-
secutive years shall be prima facie evidence of abandonment.” Id. See Vais Arms,
Inc. v. Vais, 383 F.3d 287 (5th Cir. 2004) (the party seeking to show abandonment
must demonstrate both “discontinued use of the mark” and an intention “not
to resume its use”). Should personal property also be presumed abandoned if
not used for three years? Are the costs and benefits of trademark abandonment
similar to those of personal property abandonment? Real property abandon-
ment? Is permitting the abandonment of trademarks consistent with trademark
law’s overarching purposes? See generally Alfred C. Yen, The Constructive Role
of Confusion in Trademark, 93 N.C. L. Rev. 77, 111-112 (2014) (abandonment
creates modest consumer confusion, but, counterintuitively, this may be a good
thing overall).
6. Can one’s name be abandoned?  In the Vais case above, the court found that
George Vais had abandoned the mark “Vais Arms,” belonging to his namesake
company. But other courts see things somewhat differently. Basketball legend
Lew Alcindor led the UCLA men’s basketball team to national championships in
1967, 1968, and 1969. In 1971, while starring in the NBA, Alcindor permanently
changed his name to Kareem Abdul-Jabbar as an affirmation of his Muslim faith.
During the 1993 Men’s College Basketball Tournament, General Motors ran
advertisements for its Oldsmobile Eighty-Eight that compared the car’s record
of excellence (being named a Consumer Digest Best Buy three years in a row)
to Lew Alcindor’s excellence (being named NCAA Tournament Most Valuable
Player three years in a row). Abdul-Jabbar sued General Motors for violating his
trademark rights in his birth name. Abdul-Jabbar conceded that he had stopped
using the name Lew Alcindor for commercial purposes more than a decade ago.
General Motors argued that this non-use amounted to abandonment. The Ninth
Circuit ruled in Abdul-Jabbar’s favor. Abdul-Jabbar v. General Motors Corp., 85
F.3d 407 (9th Cir. 1996).
The court deemed the clear language of 15 U.S.C. § 1127 inapplicable to
people’s birth names. “One’s birth name is an integral part of one’s identity; it is
not bestowed for commercial purposes, nor is it ‘kept alive’ through commercial
use. A proper name thus cannot be deemed ‘abandoned’ throughout its pos-
sessor’s life, despite his failure to use it, or continue to use it, commercially.” 85
F.3d at 411. Is there a coherent reason why trademark rights to one’s name ought
to be treated like fee simple interests in land, such that neither can be abandoned
as a matter of law? Do any of the reasons for prohibiting the abandonment of real
estate apply to identities? Are there other reasons why the law might prohibit the
abandonment of one’s identity for commercial purposes?
232

Speaking of abandonment, General Motors ceased production of the


Oldsmobile Eighty-Eight in 1999.

4. The Right to Destroy

As we saw in the previous section, the answer to the question of whether it is pos-
sible to abandon property depends greatly on what kind of property is at issue.
A fee simple interest in property cannot be abandoned, though lesser interests
in land sometimes can be. (See page 228.) Personal property can be abandoned.
And trademarks can be abandoned quite readily, with the law even presuming
abandonment under certain circumstances, though abandonment seems to
mean something a bit different in the trademark context. What about an owner
who wishes to eliminate property altogether? Consider the following cases.

Eyerman v. Mercantile Trust Co.


Missouri Court of Appeals, 1975
524 S.W.2d 210

Rendlen, J. Plaintiffs appeal from denial of their petition seeking injunction to


prevent demolition of a house at #4 Kingsbury Place in the City of St. Louis. The
action is brought by individual neighboring property owners and certain trustees
for the Kingsbury Place Subdivision. We reverse.
Louise Woodruff Johnston, owner of the property in question, died January
14, 1973, and by her will directed the executor “to cause our home at 4 Kingsbury
Place . . . to be razed and to sell the land upon which it is located . . . and to trans-
fer the proceeds of the sale . . . to the residue of my estate.” Plaintiffs assert that
razing the home will adversely affect their property rights, violate the terms of the
subdivision trust indenture for Kingsbury Place, produce an actionable private
nuisance and is contrary to public policy.
The area involved is a “private place” established in 1902 by trust indenture
which provides that Kingsbury Place and Kingsbury Terrace will be so main-
tained, improved, protected and managed as to be desirable for private resi-
dences. The trustees are empowered to protect and preserve “Kingsbury Place”
from encroachment, trespass, nuisance or injury, and it is “the intention of these
presents, forming a general scheme of improving and maintaining said property
as desirable residence property of the highest class.” The covenants run with
the land and the indenture empowers lot owners or the trustees to bring suit to
enforce them.
Except for one vacant lot, the subdivision is occupied by handsome, spa-
cious two and three-story homes, and all must be used exclusively as private resi-
dences. The indenture generally regulates location, costs and similar features for
any structures in the subdivision, and limits construction of subsidiary structures
except those that may beautify the property, for example, private stables, flower
houses, conservatories, play houses or buildings of similar character.
233

On trial the temporary restraining order was dissolved and all issues found
against the plaintiffs. . . .
Whether #4 Kingsbury Place should be razed is an issue of public policy
involving individual property rights and the community at large. The plaintiffs
have pleaded and proved facts sufficient to show a personal, legally protectible
interest.
Demolition of the dwelling will result in an unwarranted loss to this estate,
the plaintiffs and the public. The uncontradicted testimony was that the current
value of the house and land is $40,000.00; yet the estate could expect no more
than $5,000.00 for the empty lot, less the cost of demolition at $4,350.00, mak-
ing a grand loss of $39,350.33 if the unexplained and capricious direction to the
executor is effected. Only $650.00 of the $40,000.00 asset would remain.
Kingsbury Place is an area of high architectural significance, representing
excellence in urban space utilization. Razing the home will depreciate adjoining
property values by an estimated $10,000.00 and effect corresponding losses for
other neighborhood homes. The cost of constructing a house of comparable size
and architectural exquisiteness would approach $200,000.00.
The importance of this house to its neighborhood and the community is
reflected in the action of the St. Louis Commission on Landmarks and Urban
Design designating Kingsbury Place as a landmark of the City of St. Louis. This
designation, under consideration prior to the institution of this suit, points up
the aesthetic and historical qualities of the area and assists in stabilizing Central
West End St. Louis. It was testified by the Landmarks Commission chairman that
the private place concept, once unique to St. Louis, fosters higher home mainte-
nance standards and is among the most effective methods for stabilizing other-
wise deteriorating neighborhoods. The executive director of Heritage St. Louis,
an organization operating to preserve the architecture of the city, testified to the
importance of preserving Kingsbury Place intact:

The reasons (sic) for making Kingsbury Place a landmark is that it is a definite
piece of urban design and architecture. It starts out with monumental gates on
Union. There is a long corridor of space, furnished with a parkway in the center,
with houses on either side of the street, . . . The existence of this piece of archi-
tecture depends on the continuity of the (sic) both sides. Breaks in this continuity
would be as holes in this wall, and would detract from the urban design qualities
of the streets. . . . Many of these houses are landmarks in themselves, but they add
up to much more.  .  .  . I would say Kingsbury Place, as a whole, with its design,
with its important houses . . . is a most significant piece of urban design by any
standard.

To remove #4 Kingsbury from the street was described as having the effect of a
missing front tooth. The space created would permit direct access to Kingsbury
Place from the adjacent alley, increasing the likelihood the lot will be subject to
uses detrimental to the health, safety and beauty of the neighborhood. The mere
possibility that a future owner might build a new home with the inherent archi-
tectural significance of the present dwelling offers little support to sustain the
condition for destruction.
234

[N]o individual, group of individuals nor the community generally benefits


from the senseless destruction of the house; instead, all are harmed and only
the caprice of the dead testatrix is served. Destruction of the house harms the
neighbors, detrimentally affects the community, causes monetary loss in excess
of $39,000.00 to the estate and is without benefit to the dead woman. No reason,
good or bad, is suggested by the will or record for the eccentric condition. This
is not a living person who seeks to exercise a right to reshape or dispose of her
property; instead, it is an attempt by will to confer the power to destroy upon an
executor who is given no other interest in the property. To allow an executor to
exercise such power stemming from apparent whim and caprice of the testatrix
contravenes public policy.
The Missouri Supreme Court held in State ex rel. McClintock v. Guinotte,
204 S.W. 806, 808 (Mo. 1918 (en banc)), that the taking of property by inheritance
or will is not an absolute or natural right but one created by the laws of the sover-
eign power. The court points out the state “may foreclose the right absolutely, or
it may grant the right upon conditions precedent, which conditions, if not other-
wise violative of our Constitution, will have to be complied with before the right
of descent and distribution (whether under the law or by will) can exist.” Further,
this power of the state is one of inherent sovereignty which allows the state to
“say what becomes of the property of a person, when death forecloses his right
to control it.” Id. at 808, 809. While living, a person may manage, use or dispose
of his money or property with fewer restraints than a decedent by will. One is
generally restrained from wasteful expenditure or destructive inclinations by the
natural desire to enjoy his property or to accumulate it during his lifetime. Such
considerations however have not tempered the extravagance or eccentricity of
the testamentary disposition here on which there is no check except the courts.
In the early English case of Egerton v. Brownlow, 10 Eng. Rep. 359, 417
(Queen’s Bench 1853), it is stated: “The owner of an estate may himself do many
things which he could not (by a condition) compel his successor to do. One
example is sufficient. He may leave his land uncultivated, but he cannot by a con-
dition compel his successor to do so. The law does not interfere with the owner
and compel him to cultivate his land, (though it may be for the public good
that land should be cultivated) so far the law respects ownership; but when, by a
condition, he attempts to compel his successor to do what is against the public
good, the law steps in and pronounces the condition void and allows the devisee
to enjoy the estate free from the condition.” . . .
In the case of In re Scott’s Will, Board of Commissioners of Rice County v.
Scott et al., 93 N.W. 109 (Minn. 1903), the Supreme Court of Minnesota stated,
when considering the provision of a will directing the executor to destroy money
belonging to the estate: “We assume, for purpose of this decision, that the direc-
tion in the codicil to the executor to destroy all of the residue of the money or
cash or evidences of credit belonging to the estate was void.” Id. at 109. See also
Restatement, Second, Trusts §124, at 267: “Although a person may deal capriciously
with his own property, his self interest ordinarily will restrain him from doing so.
Where an attempt is made to confer such a power upon a person who is given no
other interest in the property, there is no such restraint and it is against public
policy to allow him to exercise the power if the purpose is merely capricious.” . . .
235

The term “public policy” cannot be comprehensively defined in specific


terms but the phrase “against public policy” has been characterized as that which
conflicts with the morals of the time and contravenes any established interest of
society. Acts are said to be against public policy “when the law refuses to enforce
or recognize them, on the ground that they have a mischievous tendency, so as to
be injurious to the interests of the state, apart from illegality or immorality.” . . .
Public policy may be found in the Constitution, statutes and judicial deci-
sions of this state or the nation. In re Rahn’s Estate, 291 S.W. 120 (Mo. 1927). But
in a case of first impression where there are no guiding statutes, judicial decisions
or constitutional provisions, “a judicial determination of the question becomes
an expression of public policy provided it is so plainly right as to be supported
by the general will.” In re Mohler’s Estate, 22 A.2d 680, 683 (Pa. 1941). In the
absence of guidance from authorities in its own jurisdiction, courts may look to
the judicial decisions of sister states for assistance in discovering expressions of
public policy. . . .
Although public policy may evade precise, objective definition, it is evident
from the authorities cited that this senseless destruction serving no apparent
good purpose is to be held in disfavor. A well-ordered society cannot tolerate
the waste and destruction of resources when such acts directly affect important
interests of other members of that society. It is clear that property owners in the
neighborhood of #4 Kingsbury, the St. Louis Community as a whole and the ben-
eficiaries of testatrix’s estate will be severely injured should the provisions of the
will be followed. No benefits are present to balance against this injury and we
hold that to allow the condition in the will would be in violation of the public
policy of this state.
Having thus decided, we do not reach the plaintiffs’ contentions regard-
ing enforcement of the restrictions in the Kingsbury Place trust indenture and
actionable private nuisance, though these contentions may have merit.
The judgment is reversed and the cause remanded to the Circuit Court to
enter judgment as prayed.
Dowd, P.J., concurs.

Clemens, J., dissenting. . . . The simple issue in this case is whether the trial court
erred by refusing to enjoin a trustee from carrying out an explicit testamentary
directive. In an emotional opinion, the majority assumes a psychic knowledge of
the testatrix’ reasons for directing her home be razed; her testamentary disposi-
tion is characterized as “capricious,” “unwarranted,” “senseless,” and “eccentric.”
But the record is utterly silent as to her motives.
The majority’s reversal of the trial court here spawns bizarre and legally
untenable results. By its decision, the court officiously confers a “benefit” upon
testamentary beneficiaries who have never litigated or protested against the
razing. The majority opinion further proclaims that public policy demands we
enjoin the razing of this private residence in order to prevent land misuse in the
City of St. Louis. But the City, like the beneficiaries, is not a party to this lawsuit.
The fact is the majority’s holding is based upon wispy, self-proclaimed public
policy grounds that were only vaguely pleaded, were not in evidence, and were
only sketchily briefed by the plaintiffs.
236

The only plaintiffs in this case are residents of Kingsbury Place and trust-
ees under its indenture. In seeking to enjoin the removal of testatrix’ home at #4
Kingsbury Place, these plaintiffs claim they are entitled to an injunction first, by vir-
tue of language in the trust indenture; secondly, because the razing would constitute
a nuisance; and thirdly on the ground of public policy. But plaintiffs have not shown
the indenture bars razing testatrix’ home or that the razing would create a nuisance.
And no grounds exist for ruling that the razing is contrary to public policy.
The Trust Indenture. Kingsbury Place is a “private place” established in 1902
by trust indenture. Except for one well-tended vacant lot (whose existence the
majority ignores in saying the street minus #4 Kingsbury Place would be like “a
missing front tooth”) the trust indenture generally regulates size, constructions
and cost of structures to be built on Kingsbury Place. It empowers the trustees
to maintain vacant lots and to protect the street from “encroachment, trespass,
nuisance and i